Monday, September 29, 2008

The Transparency International report

The Transparency International report
Stabroek News. September 29, 2008 @ 5:01 am In Editorial | 7 Comments

When he dismissed the latest unflattering report of Transparency International (TI) on perceived corruption here, Head of the Presidential Secretariat, Dr Roger Luncheon employed one of the well-worn excuses of his administration by suggesting that those persons who might have been interviewed for the purposes of the survey might have had an anti-government stance.

It is one of the most enduring and distasteful of the weaknesses exhibited by PPP/C administrations since 1992: the tendency to equate professionalism and dissenting views with an oppositionist agenda. Dr Luncheon evinced no readiness to concede that the persons interviewed may have conveyed their professionally held views and that this was something that the government would seek to address.

The TI reports have been well thought of in influential circles internationally and the government would do well not to dismiss them so easily and unthinkingly.

With the highest perceived corruption in the English-speaking Caribbean, the government should consider what that might do in relation to the investment attractiveness of this location. Savvy investors will consult a multiplicity of sources about the investment climate here including TI so one of the immediate dangers is that this index could dissuade investors unless they are of the mercenary breed and prepared to pay bribes to plunder resources or the local market.

The other serious toll of corruption is the loss to the economy from evasion and smuggling, the loss to average citizen and taxpayer who is a victim of these acts and the renting of the fabric of uprightness of the society.

The findings of the TI report are unsurprising and not only because they are in line with the verdicts of previous years. There are strongly held views locally that corruption is entrenched at many levels of public business and in high places. Those views may not have shaken the ruling party in an electoral sense but they do exist and may have been the type that contributed to the TI assessment.

Broadly conceived, corruption would be the flouting or nullification of any law or procedure for inducement. While the average person might envisage it mostly in terms of evasion of taxes or avoidance of duties at ports or kickbacks in high-profile deals it also refers to every other engagement between the citizen and the machinery of the state such as the demanding of fees for the illegal reconnection of a utility service or for the placement of a child in a certain school or at a police check point.

Those acts in the every-day lives of Guyanese have become legend and there isn’t one among our midst who couldn’t readily recall with some mirth or awe a corrupt act either demanded or procured recently.

That is one level. Another exists in the rarified atmosphere of the corridors of power where big deals are hammered out. It doesn’t only refer to acts of outright corruption but also the opaqueness and silence – the ever darkening veil of officiousness around major deals – that is supposedly to protect investors from some unseen enemy but is more likely to spare the blushes of those engaged in the deal making.

What goes on away from the glare of public scrutiny can often lead to unremitting and unrequited questions which eventually spawn the perception that something has gone wrong. The deal for the QAII investment is a case in point. The government was caught promising concessions that were not catered for by the law and only after weeks of pillorying did it do the mature thing and offer its regret. There remain other disturbing questions about the fairness of this deal and it is a prime example why being above board and doing everything in the open is an important safeguard from.

The government has entertained a slew of these deals over the years including the secret MOU for the Buddy’s investment, the transaction for the National Archives building, the Kingston hotel information blackout etc. In addition if one were to refocus on abominations such as the export of dolphins from within the Office of the President and the ongoing concerns about the Fidelity probe and what it will expose about the shenanigans at the Customs and Trade Administration one can easily see where these TI perceptions may be generated from. Around 18 months after the completion of the world cup there is no accounting for the expenditure or a detailed description of the investment for it and there is still no credible account of the massive expenditure during the Great Flood of 2005.

Unless there is a clean and comprehensive break from the improper ways of doing things the ghosts will come back to haunt and remain on the radar of the corruption watchers. If the government were serious about dispelling these perceptions it wouldn’t do what Dr Luncheon essayed at his press conference. It would do what other countries high up in the TI rankings have done for many years: invest the money and resources in watch dog institutions such as the Office of the Auditor General, the dysfunctional Integrity Commission, the Ombudsman, the yet to be formed Public Procurement Commission (PPC) and others so that they could perform the functions of teasing out cases of corruption and addressing them. That is simply not happening at the moment. How can billions of taxpayers’ and donor money be disbursed annually minus a PPC and its tribunal without this stoking concern about the lack of transparency?

The government seems obstinately committed to the policies of opaqueness, unchecked discretion and silence in dealing with many matters of public importance. The fallout from this will continue to be reports of the sort that emanated from TI.

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Sunday, September 21, 2008

The Fidelity/ Customs report at last?

The Fidelity/ Customs report at last?
Stabroek News. September 19, 2008 @ 5:01 am In Business, Editorial

Few recent corruption-related revelations – and there have been quite a few in recent years - have attracted the same level of public attention as the alleged Customs/Fidelity fraud. This may well have to do with huge sums of money said to have been involved or perhaps because a prominent private sector entity has been openly accused by the Commissioner General of the Guyana Revenue Authority (GRA) of attempting to deny the public treasury hundreds of millions of dollars in duties.

What also helped the matter gain public attention was the decision by President Jagdeo to insert himself into the process through an aggressive public pronouncement about a full and transparent investigation (which he said would extend beyond the actual Fidelity matter) involving, among other things the investigation of assets including bank accounts and an undertaking that the guilty would pay, whatever their political connections. The President had also said that Fidelity too could expect to be in hot water if a case could be proven against them. Utterances of that kind are almost certain to secure a measure of public attention in circumstances where, in the past, corruption-related occurrences have not exactly attracted generous official comment.

A pronouncement of this nature was also likely to secure a measure of public attention given the widespread belief that the guilty invariably do not pay. The President, it seemed, went out of his way to assure the nation that this time around those persons caught in a web of corruption would pay. By creating reasonable expectation that action would be taken on this occasion the President actually added considerable currency to the investigation and to any report on its outcomes.
No one seriously doubts that relations between operatives within the Customs and Trade Adminis-tration and businesses are often characterized by ‘arrangements’ that have to do with the evasion of duties and taxes. In fact, both the President and the Commissioner General have alluded to “rackets” and “shakedowns” in the Customs process. And while “runnings” involving payment for favours may not necessarily be confined to Customs, it is at Customs, – because of the nature of its operations and the opportunities that exist for bribes and kickbacks - that fingers are mostly pointed at whenever claims of official corruption are made.

President Jagdeo understands this only too well and his pronouncement in the wake of the Fidelity revelations was intended to make the point that in the process of pursuing the Fidelity matter government would also be seeking to break the back of the wider problems associated with the corruption-related issues inside the Customs department. And while no one is likely to be persuaded that the scams and shenanigans can be swept away purely on the basis of a presidential undertaking, President Jagdeo can hardly be blamed for trying since he is aware that bringing an end to the problems at Customs will go some way to reducing allegations of corruption against his administration.

For all these reasons it is a decidedly good thing that, according to what we learnt recently from the Auditor General’s Office, the report on the investigation promised by the President on Fidelity and other Customs issues will be made public in a few weeks time. This is the second time in recent months that we have been told that the report is nearing completion and we must hope that the phrase in a few weeks time - the promised time frame for the release of the report – is not one of those creatively contrived expressions that actually allows the real time frame for publication of the report to run into several months.

One of the reasons why publication of this particular report is so important is that it will allow for a public judgment as to whether the issues that it addresses tally with the promises made by the President. Certainly, it would be interesting to learn what the findings of the Office of the Auditor General are on the practices within the Customs and Trade Administration and whether the fact that people are able to beat the system despite a regimen of IT and human safeguards does not bespeak a wider management problem. Put differently, to what extent was the Fidelity Affair actually facilitated by sheer managerial incompetence?

What the President said, therefore, has implications for much more than publication of a report.

Since both the President and the Commissioner General of the GRA have gone on record as conceding irregularities within operations of Customs and since the President has promised to “dig deep” on this issue, one expects that the report will also a provide a perspective on this issue. And of course it will be interesting to see whether the President’s promise of “no sanctuary” for those guilty parties will hold up or whether those involved in the scam will scurry for political protection.

This newspaper has repeatedly reminded – in at least three editorials – of the need to push ahead with the promised investigation, not because of any feigned sense of moral outrage but because the President had more-or-less placed his own credibility on the line by pointedly pronouncing on the issue. We believe – and we have said this previously – that given what both the President and the Commissioner General have said about the matter any attempt to evade an investigation or to “doctor” or “duck” any of its findings is bound to have the effect of deepening already existing healthy public cynicism about the commitment of the government to stamping out corruption in public institutions.

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Saturday, September 20, 2008

Shame on you, Barama. Pay your taxes instead of paying starvation wages and pitiful bursary awards.

Shame on you, Barama. Pay your taxes instead of paying starvation wages and pitiful bursary awards.

Do you know what is the 'acreage fee' which Barama pays in return for exclusive right to log on 1.6 million acres of Guyana?
Answer:US $2,000 a year.
By the way Barama is in arrears for those payments. Additionally Barama has not declared a profit in any year since it began operations in Guyana in 1992.

Barama should be ashamed to issue a press release praising itself for pledging to make a one time award of US $2,700 total (US $1 - G $200) to 9 Guyanese children of its employees.

Barama should also disclose the monthly salaries of its Guyanese AND Malaysian employees.

Children of Barama employees get bursary awards
Stabroek News. September 20, 2008

Nine children of employees of Barama Company Limited who passed the National Grade Six Assessment will benefit from bursary awards that will be presented to them by the company.

The awardees will be receiving $20,000 each for the next three terms of the academic year.
A Barama press release yesterday stated that the company had agreed in July to reinforce the awards to benefit the children of their employees from both the Land of Canaan and Buckhall locations.

The company said also it was proud of the nine children who will be presented with the awards since they had met the criteria of 450 marks and above. Barama added that it encourages all parents to be supportive of their children’s education.

The top three students were Kimeka Craig (494), Shemar Martins (487) and Tyhesia Higgins (485).

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Friday, September 19, 2008

Timehri demolition…Bulldozer operator refuses order, breaks down in tears

The following KN story illustrates the (mis)governance prevalent in Guyana: swift action by the government to bulldoze the homes of the poorest Guyanese; at the same time no official response or investigation of the allegation that the Timehri runway lights were stolen by GDF ranks and sold to a well-known PPP activist / fish exporter.

Was the bulldozer operator or his company acting in accordance with a court order? If not, why not?

Timehri demolition…Bulldozer operator refuses order, breaks down in tears
Kaieteur News, September 19, 2008 | By knews | Filed Under News

Government must order an immediate halt to demolition, and forthwith arrange a genuine consultation with the residents towards the end of regularising the area into a housing scheme.
This is according to the Alliance for Change in a statement to the media yesterday. The political party also questioned whether the government was not cognizant of “what it might be spawning when children watch in horror how their parents’ homes and belongings are crushed? The AFC demands a better way out than the demolition of homes of law abiding Guyanese.”
The party noted that it was increasingly outraged at the manner in which the government, especially through its Minister of Works, Robeson Benn, was destroying the houses of hardworking Guyanese in the Timehri area aback of the Cheddi Jagan International Airport. “There must be a better, more humane way out of this dispute.”
More than 400 families have made the contentious area their homes over the last 40 years. “Some like the ‘Sams’ have been there for in excess of 50 years. Others are of more recent vintage, all of whom have found gainful employ in the area but all of these persons have worked hard to clear the grounds of thick vegetation and leveled the land to set up their foundations and structures, utilizing the entirety of their life’s savings…The values of some of these structures must be in the vicinity of $10M and more.”
The party also noted that the demolition exercise was all done in the face of Central, Regional and Local Government officials from the very inception. “Yet in this background of open acquiescence by the authorities and what must be regarded as actual permission by virtue of the granting of lights and water to these families, a demolition job has commenced where a minimum of eight houses have already been brought down.”
It was noted that the ninth did not go down because the bulldozer driver simply started crying when he realized that the next house he was instructed to destroy belonged to his friend.
“He simply could not do it in spite of the exhortations of the police officers that he drive and destroy the homes…The AFC commends the driver for telling the officers, ‘Officer I can not do it…Enough is enough…You might soon instruct me fuh bulldoze me own one too. No!’”
The AFC also reported that based on recent meetings with families made homeless and threatened with homelessness upon a recent visit into the area, the party has learnt that the whole community has been demonised as a result of the recent spate of theft of the airport’s runway lights.
It was also noted by the party that utterances from senior Government and Regional officials, who were asked why the ‘draconian’ measure of demolition of homes was being used, insinuated that the community had harboured Fine Man and Skinny, an allegation which the residents totally denied.
Others alleged that the residents had stolen the airport runway lights.
The party noted that its investigations have revealed that two GDF ranks stole the runway lights and sold them to a well known PPP activist who is also a high profile exotic fish exporter.
“Instead of charges being instituted for larceny and receiving stolen property against these culprits, the Minister of Demolition Mr. Robeson Benn, who is right now facing contempt charges for demolishing a structure in breach of a High Court Order, is on his merry-way ordering the breaking up of everything in the area…
“Leaders of the AFC have seen the frustration, defiance and anger in the eyes of the children and young people made homeless and who are threatened with homelessness…It is frightening to contemplate what passions may be aroused as a result of this uncaring, heartless action on the part of the Government unto these who the government calls the future of Guyana.”

Tuesday, September 16, 2008

New Skeldon plant commissioning pushed back

New Skeldon plant commissioning pushed back
Stabroek News, September 16, 2008 @ 5:06 am In News | No Comments
– contractor correcting technical issues

Technical problems, which arose earlier this month, have seen the commissioning of the $181 million Skeldon sugar factory pushed back, possibly to early October, GuySuCo Chief Executive Nick Jackson said yesterday.

At a press conference at Herdmanston House yesterday, Jackson, the Chairman of GuySuCo’s Board of Directors Ronald Alli and construction contractor Andrew Jin of CNTIC of China sought to assure the media that the problems at Skeldon, which were brought to the public’s attention by the AFC on Friday, did not involve major technical component failures or structural deficiencies.

Last week the AFC had said that the sugar industry was in danger of collapse; that component failures and structural problems were found during the commissioning of the plant.

Asked when the commissioning would resume, Jackson said: “It is very difficult to anticipate at this stage but we assume that we could restart the commissioning in early October.”

Explaining the technical problems, Jin said that during the second part of the commissioning exercise, earlier this month, involving a 72-hour test run, the plant experienced some difficulties.

These involved problems of the interface between the punt dumper and the conveyor belt and problems with the shredder bearings among other technical difficulties. The contracting company, he said was conducting assessments and remedial work and was working collaboratively with the engineers and employers to move the project to the next stage of the commissioning.

He said CNTIC has invited specialists from reputable suppliers of machinery and equipment for the plant, from South Africa, England, Australia and Sweden among other places, to take part in the commissioning.

“I want to clarify that we do not have any major component failure or structural problems during the commissioning,” Jin said adding that from the design and the supply of equipment, the project was a very advanced one.

He said major construction was completed in May and the commissioning began on August 26 with three dry runs. From September 9 to 11 the factory crushed a total of 2,000 tonnes of sugar cane when it ran into technical difficulties.

He said an engineer from Australia who has worked on a similar project on that continent was working along with CNTIC to recommence commissioning as soon as possible.

Asked about losses resulting from the delay of the commissioning of the new plant, Ally said the major issue was to get the sugar cane off the ground. “That is why we have said that we are mitigating those risks by starting the old factory and commencing the extraction of sugar from the sugar cane that is in the ground from Skeldon,” he said.

By the time the tests are completed, he said, he hoped there would still be enough cane to process in the new factory in preparation for the first crop next year.

According to Jackson, with the close of the first crop in May 2008 and the completion of the factory, GuySuCo had to wait for the commencement of the second crop to carry out two important tests prior to the handing over of the factory – a 24-hour test and a 72-hour test.

He said after those two tests, which would allow for the handing over of the project to GuySuCo, there would be three other 72-hour tests over the next year and the contractor would still be liable for defects arising from those tests. However, the factory would be in commercial use during that period.

In response to how GuySuCo was dealing with the loss of working days owing to inclement weather recently, Jackson said that because land preparation and planting were greatly affected, the corporation had increased its machinery fleet and contracted out some of the work to ensure it was completed in time.

Alli said that in addition to augmenting the fleet, GuySuCo was also looking at new and improved techniques to reduce the volume of work so that tillage, normally one day for 2.2 hectares, could be reduced during the uncertain weather patterns.

Jackson said that it was never anticipated that the factory would be fully utilized for the first year, but that it would be at full production by 2010.

He said that during the aborted commissioning phase, GuySuCo put into operation its mechanised harvesters for the first time on a commercial basis to provide cane to the factory. “I must admit that for the first couple of days, the guys who had never driven them before did a fantastic job at harvesting cane, collecting and putting them into the punt,” he said.

In addition, he said that as a part of the modernising of the factory, GuySuCo has been providing 10 megawatts of power to the national grid, which is fed to the Berbice area since December 2007.

On July 11, Minister of Agriculture, Robert Persaud had told the parliamentary Economic Services Committee that the Skeldon factory was set to roll on August 2.

He had said that GuySuCo was “contractually obliged to supply cane to the new factory from August 2, with a date of takeover of August 8, 2008.”

CNTIC, he said, would then have 28 days from the date of takeover to achieve full operation.
If the takeover process was not completed during this period, liquidated damages would apply.

While he admitted that the Skeldon project was behind its scheduled start up time, he said that contrary to an assumption, there was never any agreement to deliver the factory in 2006. He noted that the project was conceived in 1998/1999 but Guyana’s classification as a Highly Indebted Poor Country delayed the start until 2004. The contracts were not signed until late January 2005, owing to the floods that affected the country’s coastland.

The original date of completion was October 2007 but because of increased piling and other delays, including weather and the Chinese contractors’ visa issues, completion was set for August 2 this year.

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Monday, September 15, 2008

Sugar on the line

Sugar on the line
Kaieteur News. September 15, 2008 | By knews | Filed Under Editorial

The temperature is rising in the sugar industry. It has recently been forced to deal with a three-day strike that brought its operations in all eight sugar estates to a complete halt.

The issue that precipitated the strike – a wage offer by Guysuco that was deemed totally unsatisfactory to the workers and their union – is still outstanding. It has been sent to arbitration and the two sides are still very far apart.

The workers are signalling that they may resort to the strike weapon if the wage offer remains unsatisfactory, or if their union buckles under.

One political party has entered the fray and has made a number of accusations about alleged maladministration in the industry.

These charges were promptly answered by management. The Minister of Agriculture has accused the political party of opportunism, and we can all be sure that there will be further charges and counter charges.
We would wish to caution all concerned stakeholders about the dangers of making the sugar industry into a political football. The stakes are just too high for our country.

Without even getting into the abstractions of percentage share of the GDP, sugar remains the bedrock of our economy – at least for the foreseeable future – and it is owned by the people of Guyana.

The immense investment in the new Skeldon Estate of approximately one-quarter billion US dollars is a done deal, and the eighteen-odd thousand workers of GuySuCo represent the largest organised bloc of workers in the country.

Their taxes are very significant to the national coffers. The foreign currency brought in by sugar remains very significant, and even though it has been eclipsed by remittances, the latter is a volatile quantum.

Then, of course, there are the cane farmers, whose numbers and acreages were to be greatly augmented by the Skeldon expansion.

Sugar, then, is part and parcel of our national patrimony, and we have to all work together to ensure that it remains a healthy industry that can benefit us all. The Government is obviously aware that all is not well in the industry, since it has ordered a far-reaching review of the operations of GuySuCo.

The Government must not automatically assume that the comments on the industry from other Guyanese organisations and institutions are inherently negative. They could very well arise from the same concerns that prompted the Government-inspired review, and it is, in fact, the duty of all Guyanese to inquire about their patrimony.

Unfortunately, one of the major problems that confront the concerned citizen who wishes to gauge the state of health of the sugar industry is the paucity and lack of relevant information.

Even though a full decade has elapsed since the launch of the sugar modernisation (and expansion) plan, the GuySuCo Annual Report is still invariably over a year late – every year. For instance, we still do not have the report for 2007.

This state of affairs is totally unacceptable in a world of global corporations with annual sales many times the size of Guyana’s GDP, which release consolidated reports quarterly. One hopes that the The Skeldon expansion is the linchpin of the sugar strategy, and its launch has now been delayed by some two years and counting.

GuySuCo has to be much more forthcoming with the details of the project. In the absence of hard, reliable data, it is not surprising that rumours have taken over. Questions abound even to the layperson.

If, for instance, the increased acreage at Skeldon was supposed to be delivering cane since 2006, where has the excess cane gone in the absence of the new factory? The question becomes even more pointed in the face of actually declining overall production.

This newspaper intends to conduct its own inquiry into the state of health of the sugar industry as a public service initiative. It is our hope that the management of GuySuCo and the Ministry of Agriculture will cooperate with us as we all try to serve the people of Guyana.

Sunday, September 14, 2008


Kaieteur News. September 14, 2008 | By knews | Filed Under Features / Columnists, Peeping Tom

The developed civilizations of the West have always prided themselves in their record-keeping. Bureaucracy and its paper-keeping remain features of western civilizations despite the many destructive wars and battles that have caused so much destruction in those parts of the world.

Great empires have fallen but what has never been diminished was the preoccupation with record-keeping and especially the need to preserve for history the minutest of details.

The archives of Europe have an unmatched collection of records, not only chronicling its long and violent past but also equally reprehensible and brutal colonization of the New World.

It was to these records of treaties, maps and agreements that the high level team which argued Guyana’s case before the Law of the Sea Convention went in preparing their brief.

It is doubtful whether without access to these resources, preserved in Europe, that Guyana would have been able to have emerged with such a convincing case.

That we did is a tribute to the team, to their understanding of international law and to the sources which they could rely on to support Guyana’s case in its maritime border dispute with Suriname.

Record-keeping, especially diplomatic note-keeping, is of vital service to history. Each year hundreds of top secret and previously classified files are made public.

These provide a lasting account, adding to our knowledge, helping to revise or confirm history, always extremely useful.

The release of records now also includes transcripts of official telephone conversations between top government officials in the US.

One such release provides an account of how amused the Americans were of the Guyanese administration in the early seventies.

It gave a sense of the overall esteem with which our government was held despite the convenience of a relationship occasioned by common Cold War interests. To the historian, even the finest details are something to be valued.

The notes of what at the time may seem to be the most unimportant of meetings unravel a great deal about the period.

When it comes to diplomatic exchanges, however, no meeting is unimportant. Every encounter presents an opportunity to gain deeper insights.

Beneath the fineries of diplomatic language are to be found the crucible of motivations and intent.
For this reason, diplomatic note-taking is vital for both the present and forthcoming generations.

The Brazilians, who recently along with their ambassador paid a visit to our Head of State, appreciate the utmost importance of detailing what was said at that meeting because the record of such meetings have both historic and legal significance.

At the meeting with our President, clips of which were shown on national television, there was a member of the Brazilian delegation taking detailed notes of what was being said. This was no ordinary courtesy call. This was a meeting between our Head of State and a visiting delegation.

Yet, as we have seen on so many occasions in the past, and for some inexplicable reason, our President met alone with the delegation.

Not even the Minister of Foreign Affairs was present. But more regrettable, there was no official note-taker for Guyana.

Any official record of that most important meeting will now have to come from the Brazilians. And if in the future there are differing interpretations of what was said at that meeting, there will be only one written source, the Brazilians’.

The Jagdeo administration continues to ignore these important protocols in diplomatic exchanges.

It is tragic for a government which when it took over office could not find the minutes of Cabinet meetings to continue after sixteen years in power to not appreciate the importance of diplomatic protocols, one of which is the need for someone to be present taking notes. It reveals a great deal about how this country is managed. It is sad indeed.

But none more sad than last Thursday’s press conference, which ended by the President asking the coterie of reporters whether they had any more questions.

Once again, our President was forced to chair his own press conference. There is no precedent anywhere for something like this.

It is unacceptable that the President of Guyana should not have someone to moderate his press conferences and briefings.

I can just see a historian fifty years into the future being bemused by all of this. I can just imagine the numerous light-hearted references that will be made.

Let us hope that now that there is an appreciation that you cannot simply announce the appointment of an ambassador - that there are diplomatic protocols to be followed, including gaining the approval of the foreign country to which the ambassador will be assigned - that we will see a marked improvement in the way diplomatic engagements are treated.

Let us hope that in the future whenever a foreign diplomatic team has to visit our Head of State and Head of Government, that Guyana will not have a singular presence at that meeting.

Saturday, September 13, 2008

PNCR urges gov’t to publish names of contract awardees

PNCR urges gov’t to publish names of contract awardees

Stabroek News. September 12, 2008 @ 5:17 am In News | 16 Comments

The PNCR yesterday issued a call to the government to publish the names of individuals and companies that have been awarded contracts since for sometime now it has been awarding substantial contracts without saying who are the awardees.

The PNCR in a press statement said that there must be some major political reason for the adoption of this approach for the award of contracts.

“This is not difficult to discern, since the Jagdeo administration continues to award substantial contracts to its cronies and is, therefore, reluctant to publish their names in the media,” the opposition party charged.

As a consequence, the PNCR said, it cannot be determined whether contracts are being awarded in an equitable manner or whether political considerations predominate.

The party added that the administration should in the interest of transparency ensure that the names of the individuals and companies are published when contracts are awarded in the future.

The PNCR also contended that the government has repeatedly said that it believes in transparency and accountability when it comes to the award of contracts, but in this as in other matters, its behaviour belies its utterances.

According to the party, it is evident that the PPP/C administration does not wish to have any effective National Assembly oversight of its public procurement practices.

The PNCR also pointed to what it said was the continued resistance of the administration to efforts to establish the constitutionally mandated Public Procurement Com-mission and to ensure that the Office of the Auditor General is fully autonomous and urgently provided with the resources to conduct value-for-money audits.

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Tuesday, September 9, 2008

The Gilhuys decision

The Gilhuys decision
Stabroek News Editorial. September 8, 2008

While the decision of the DPP’s Chambers not to recommend any charges against Magistrate Gordon Gilhuys over the shooting of a policeman has been considered on its merits, it cannot be divorced from the milieu in which it has been introduced.

Guyana is wracked as it has never been in its post-independence history by bloody, pernicious and unrelenting crime – most savagely underlined by the three massacres this year which claimed 31 lives. Each and every day gun crimes are being reported: murders, robberies, woundings and domestic violence – many with unlicensed weaponry and fuelled by the ease with which guns can be smuggled, procured and rented in these parts.

Moreover, it is broadly accepted that respect for the rule of law has been so systemically undermined that impunity is the order in the day, not only in the cartels, gangs and amongst the petty criminals, but in every other sphere of life: on the roads, in the schools and in everyday interactions. A society in which the rule of law is so disdained is in serious danger and can ill afford any further erosion.

When Magistrate Gilhuys was implicated in the shooting of policeman, Corporal Mark George, it immediately raised that age-old question that all law-based societies face: will citizens of stature – and particularly in this case, a member of the bench who has undoubtedly presided over cases like this one – be treated the same way as the less powerful in the society?

In this case it was pivotal that justice not only be done but that it was seen to be done. Unfortunately the manner in which this investigation was conducted and the final decision made by the DPP’s Chambers can only lead the citizenry to shake their collective head in dismay and utter as they might, “Yuh see, is de same thing I seh.”

First, considering the general circumstances of the incident and the shooting of the policeman that night on Woolford Avenue, had it been an ordinary citizen he/she would have been hauled forthwith before a magistrate the very next day or quite soon thereafter. There would have been no need for a referral of the case to the DPP at all. Commissioner Greene’s explanation that where cases revolve around policemen they prefer another opinion is completely invalid and unconvincing considering that in less clear-cut cases involving the police charges have been preferred without reference to the DPP.

Second, in the matter of the allegedly unlicensed firearm that was used there has still been no explanation why a charge was not laid, even if the said firearm was not the one which injured Corporal George. Will one be provided?

Third, the DPP’s assertion that deficient statements were presented by the police warranted the strongest possible rebuke of the police and a demand that the deficiencies be cleared up by the errant officers. Why was this not done and publicized by the DPP before a recommendation was made for no charges?

Fourth, the disclosure that Corporal George had importuned the DPP not to institute criminal proceedings and had volunteered that the shot fired by Magistrate Gilhuys had not struck him is exceedingly unusual and would do nothing to defuse concerns that compensation to complainants is leading to the termination of criminal proceedings.
Fifth, more than two months elapsed in a relatively straightforward case before the police and the DPP could finally pronounce on this matter. What type of criminal justice system is this?

Sixth, if no charges were to be brought against Magistrate Gilhuys, then the public should logically deduce that the conduct of the police that night was most unprofessional: that they improperly proceeded along Woolford Avenue, that they improperly stopped there, that they improperly approached the vehicle, that they improperly fired at it and in the ensuing two months they could present nothing to their superiors or to the DPP’s Chambers to make a convincing case that they had acted appropriately.

All of the above will further degrade the already shaky foundations of the rule of law in this country. It also shines a light on a now frequently used practice by the police when they want to avoid taking tricky decisions: send the file to the DPP’s Chambers. This was the case with another unsavoury circus – the shooting and wounding matter involving Minister of Local Government, Mr Kellawan Lall. That matter ended similarly, a recommendation of no charges. The technique has also been employed by the police in another matter of public interest at Unity where a well-connected and well-known businessman in the village allegedly shot up the house of a neighbour and menaced its occupants. The result in this case will be awaited with much interest.

In her reply to the news items on the decision on Magistrate Gilhuys, the DPP, Mrs Shalimar Ali-Hack contended that the reports had been carried without any recourse to her office. Stabroek News completely rejects this assertion. Mrs Ali-Hack’s secretarial staff has not served her well. There have been numerous queries by Stabroek News to her office on a range of matters which have gone unanswered. Since it is more than likely that her office will soon have extended powers as it relates to plea bargaining and many more questions will therefore arise, we suggest that the DPP urgently set out publicly what the arrangements are for the press accessing her office for information on ongoing investigations and other matters so as to avoid any further misunderstanding.

The public now needs to hear from the Judicial Service Commission on this matter involving Magistrate Gilhuys. There should be no quiet sweeping of this matter from the sight of the public. It has already gouged an enormous hole in the public’s confidence in the rule of law.

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Sunday, September 7, 2008

A high stakes gamble

The View From europe
Posted By David Jessop.
Stabroek News. On September 7, 2008 @ 5:10 am In Features, Sunday
A high stakes gamble

What should one make of the fiasco over the date of the signing of the Economic Partnership Agreement (EPA) with Europe? The event, meant to take place in Barbados on September 2, has been postponed and the new date hangs on a meeting there of Caribbean Heads of Government on September 11.
Barbados Prime Minister David Thompson has made clear that in his view this meeting is not about renegotiating the agreement but aimed at forging a common position on the EPA which he feels can be made to work despite its shortcomings. Whether this latest meeting to discuss the EPA will bring to an end present divisions or result in further dissent, delay or new uncertainties still seems to be in the balance. As matters stand, Trinidad, Jamaica, Barbados, the Dominican Republic, Belize, the Bahamas and St Vincent have said that they want to sign; St Lucia says it will not; Guyana is holding a public consultation; Grenada wants more time; and there is a silence from almost all other Cariforum states. Meanwhile some opposition parties have publicly disassociated themselves, most notably in Jamaica and Antigua.

All of which makes what happens next fraught with difficulty. This is because the EPA was crafted in such a way that achieving the trade coverage in percentage terms necessary for the agreement to be WTO compatible requires the majority of states and the larger ones in particular to sign. Failure to do so (or a state like the Dominican Republic deciding to go it alone) would result in new uncertainties.

Would the EU impose on those nations that did not sign by October 31, the EU’s GSP tariff regime on products that presently enter duty free? Alternatively if the EU failed to impose the GSP would it be challenged at the WTO on the basis that the waiver for the trade provisions of Cotonou expired at the start of the year? How will those nations and industries within Caricom that will have duty and quota free access under the EPA relate to those that do not? What happens practically if more than one trade regime exists between Europe and the countries of Caricom? How would EPA development funds flow to a region where only some had signed?

There are it seems no clear answers to these and many other basic questions.
Paradoxically the absence of any public high-level political statement on Europe’s position is being seen in the region by those who do not want an EPA as a signal that in the final analysis Europe will not wish to be seen disadvantaging small nations. This view is also seen as giving weight to a school of thought that suggests that having initialled the EPA as an intent to sign, this provides sufficient legal cover at the WTO for Europe and the Caribbean to renegotiate a new deal.

To make matters more complicated still, there is a widespread belief that because one of the French President’s advisers has written a report critical of the EPA, this is now French government thinking. In fact sources suggest that the French presidency was deeply irritated by the Caribbean’s decision to postpone at very short notice the September signing date.

What all of this suggests is that in delay the region is involved in a high stakes gamble with an uncertain economic outcome.
In parallel, throughout August and into September Caribbean academics, trade experts and others have been engaged in a fierce electronic debate over the rights and wrongs of the EPA. These private exchanges reflect a wide variety of opinion but largely boil down to whether the region is ceding its sovereignty to Europe; dissatisfaction with the development dimension; anger over the alleged lack of consultation during the negotiating process; doubts about whether the Caribbean has a large enough corporate base to ever compete; the fear that European business will ‘take over the Caribbean’; and the degree of economic and commercial opportunity that the EPA presents.

At its heart those involved in the debate either require more time for the Caribbean to complete the integration process or believe that the moment has come for the region or individual nations to move, over a period of time, to making their own way in the world based on developing their ability to compete.
Irrespective of which side of the fence one stands, these are fundamental issues that one cannot help feeling should have been fully debated two-and-a-half years ago when the EPA process began.

In all of this what seems to go largely ignored is that the EPA is a part of a European strategic objective aimed at levelling its special trade relationships, irrespective of the accompanying honeyed language of development. The reality is that even if the EPA did not exist, all preferential arrangements the Caribbean has with Europe are fast eroding as is the EU’s long term interest in the region. Very soon the trade aspects of the association agreements now under negotiation with Latin nations will enable Central American, Mercosur and Andean nations to compete directly with the Caribbean. In return Europe will have levels of access to their markets similar to those envisaged by the EPA. At the same time the other liberalisation processes involving the region and especially that at the WTO, will require other nations and eventually all nations being given similar or greater levels of trade access to that being considered for Europe. If the Caribbean cannot respond by rapidly making regional integration work in order to both resist and take advantage of all market openings, the future would seem to lie between states either seeking new forms of economic dependence on wealthy energy-rich neighbours or seeking stand alone economic independence within a globally competitive environment.

As regular readers of this column will know, I believe that Europe has precipitated much of the EPA related crisis by forcing artificial relationships on a regional process that is far from even or mature; by failing to understand that the Caribbean’s desire to retain national sovereignty has a deep moral and psychological dimension running from slavery through emancipation to independence and beyond; and that factionalism, for want of a better word to describe a peculiarly Caribbean version of nationalism, is endemic.

But in all of this the Caribbean has been its own worst enemy for decades by not finding answers as to why it is so hard to implement the measures that might make the dream of a fully functioning integrated region a reality.
Previous columns can be found at

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Kaieteur News. September 7, 2008 | By knews | Filed Under Editorial

The two-day consultations on the Economic Partnership Agreement concluded yesterday. These consultations, long hinted at, but hastily arranged, are expected to inform Guyana’s position on the matter.
For such an important consultation to have been limited to two days makes a mockery of the consultation process.

If as is being claimed the Economic Partnership Agreement (EPA) negotiated between CARIFOURM and the European Union lacks developmental features and has grave implications for Guyana, if it was a product of bad faith on the part of the Europeans, it is equally regrettable that the local consultations should have been so limited and abbreviated.

While a CARICOM summit is due to be held soon on the matter, Guyana either should have moved towards extended consultations earlier or should have made it clear that on such an important issue we were not going to be rushed.

It now seems bitterly ironic that Guyana should find itself scrambling for time in its consultation on the EPA when the need to meet last year’s deadline was believed to have resulted in this less than agreeable decision.

That being said, it would also seem that the most important national deliberative body in the country, our Parliament, has been bypassed when in these consultations.

Since the Economic Partnership Agreement is akin to an international treaty, it is inexcusable that Guyana’s Parliament was not afforded the opportunity to kick start the consultations through a specially convened session.

We are sure that while Parliament is in recess that its members would have been more than willing to have had a special sitting to deal with this most critical issue which has drawn criticism from our Head of State.
We have heard a great many criticisms of the EPA leading up to the just-concluded consultations. Yet, the specific areas of criticisms have not been amplified.

As such, there is a great lack of knowledge concerning the EPA and just what exactly Guyana is objecting to. The fact of the matter remains that for the vast majority of the public there is far too little information to make an informed judgment on the matter.

This was likely to be resolved during the kick-off of the consultations which involved some expert inputs being made.

This is all the more reason why more time should have been given so that the stakeholders would have had greater time to consider the various points of view and to arrive at a considered position on the subject.

Now that the consultations are over, Guyana needs to take a realistic position on the matter. Barbados, for example, sees no possibility of the agreement between CARIFORUM and the European Union being renegotiated. As far as that country is concerned we have a done deal.

Guyana on the other hand has insisted that it is a sovereign state and therefore Barbados cannot speak for Guyana.

But is the agreement a done deal? Is it possible even at this stage for the agreement to be renegotiated? These are issues we believe should have been ventilated long before the consultations, since they do have bearing as to whether we are engaging in a futile exercise.

We hope that now that the hurried consultations have concluded, steps would be taken to at least convince the Guyanese people that the interests of Guyana are being safeguarded.

One way for this to happen is for all the parliamentary parties along with the government to hammer out a joint position.

Because of complexities and technical nature of some of the issues involved, we believe that having such consensus would be the best assurance that our people can have that on this most important issue, their interests will not be surrendered on the altar of expediency.

Jagdeo proposes signing goods-only EPA

Jagdeo proposes signing goods-only EPA
Stabroek News news item. Saturday 6 September 2008

President Bharrat Jagdeo says he is prepared to sign a goods-only Economic Partnership Agreement (EPA) with the European Union, “even if it means doing it alone,” as this would make the Cariforum grouping World Trade Organisation compatible.

Guyana was prepared to enter into a full EPA with the EU after it was determined what the implications would be, he said. He added that this would be his argument when he meets Caricom Heads of Government on the issue in Barbados on September 10, 2008.

The President, who had expressed concern about the EPA before it was initialled last December, declared his intention at a one-day national consultation on the Cariforum-EC EPA at the Guyana International Conference Centre, Liliendaal yesterday. His announcement was also well received by the majority of the participants.

Signing a goods-only agreement was first suggested at the meeting by economist Dr Clive Thomas.

Meanwhile, Deputy Director of Trade, European Commission, Karl-Friedrich Falkenburg said that since the EPA negotiating process the region had been strengthened. However, he said the issue of whether the region was going to sign the agreement individually, and ratify and implement it will test the solidarity of the region and regional integration.

Falkenburg said he has been in contact with other leaders in the region and has noted a clear resolve to sign the EPA. He warned that anyone not moving along was, in one form or another, putting the EPA at risk and causing issues with the regional integration that was so much at the centre of Cariforum’s work in the past and its workload in the future.

The EU, he said, has stated that it wants to assist the existing regional integration and not, as some are saying, to divide and negotiate. “That has not been the motivation nor the reality,” he said adding that over the years different regions in the African, Caribbean and Pacific (ACP) grouping have defined their own reality and one size cannot fit all. Cariforum, he said, was more advanced in its negotiations in some areas but in others the other regions were more advanced.

Sir Shridath Ramphal, a former head of the Caribbean Regional Negotiating Machinery (CRNM) who spoke about the implications of reciprocity in keeping with the EPA, suggested that Guyana not sign the EPA until after the ACP heads of government summit to be held in Accra, Ghana on October 2, 2008.

However, the President told the media at a press conference held shortly after the consultation that he would not attend that summit because of a speaking engagement in China. But he would send a prepared statement with Minister of Foreign Affairs Carolyn Rodrigues-Birkett.

He also told the consultation he did not know whether the Caricom heads would buy his suggestion not to sign the EPA, but to sign onto a goods-only agreement or whether they would wait until after the ACP meeting to do so.

“I will champion that. It is up to civil society to speak about this too because when governments alone speak about this they are caught in the middle. You have your networks in the region. Share with them some of the concerns here,” he told the gathering, adding that they “have a sense of what the challenges are… We will continue to take this matter up even if it means doing it alone.”

The suggestion of a goods-only agreement was picked up and supported by several participants, who were drawn from a wide section of civil society.

There were nine panellists but only two — Head of the CRNM Henry Gill and Falkenburg — were pro-EPA.
Jagdeo, in his introductory address and throughout the day asked many questions. However, he did not give Gill or Falkenburg enough time to answer most of the questions raised.

Jagdeo reiterated that the current agreement did not support the development aspirations of the region and the only reason why Guyana would sign onto it was because of the threat of tariffs and the General System of Preferences. He noted that Guyana had a lot to lose because it was among the largest exporters from the region to the EU of rice, sugar and rum.

Gill opposed Jagdeo, saying that the CRNM considered the EPA development-friendly as it had been well negotiated. He said too that it had obtained market access, with the exception of sugar and rice not receiving immediate liberalization; full access of goods on a duty-free and quota-free basis. It also offered the security of access to investments on the ground knowing they would be accepted and Europe could not pull the plug. The EPA, he said, committed the Europeans to assist in meeting sanitary and phyto-sanitary standards as well as providing technical assistance.

Issues that were of concern to Jagdeo included good faith negotiations, which he claimed the EU lacked based on its unilateral denunciation of the sugar protocol and the absence of an assessment of the social impact the EPA would have on the region. Other issues included how much funding would be available for adjustment and aid development; whether the EPA would conflict with regional integration efforts and impact negatively on the Caricom Single Market and Economy.

Gill and Falkenburg held the view that the good-only suggestion might not be a good one given the fact that apart from Guyana being a major exporter of agricultural products to Europe, other Caribbean countries were service-oriented.

Gill noted that services formed a large part of the agreement and that just about all the countries of the Caribbean were involved in the service industry. “We can’t disregard that,” he said adding that there were linkages between the goods and services sector in terms of production and efficiency, particularly in telecommunications, banking and port services. He said that when they signed onto the negotiations they were not entirely clear about the issues but they became clearer as the negotiations progressed to include competition policy, intellectual property rights and innovations.

Sir Shridath in his presentation said that Caribbean countries were not obliged under international law, treaty law or WTO rules to sign the EPA in its current form. “They are not precluded by international agreement from renegotiating that agreement or signing a part of that agreement,” he said noting that a previous speaker, Dr Chris Stevens, had already mentioned how regularly this was done.

He said there was no one option as to how this could be done noting that too many in the region have taken the view that because they initialled the agreement they must sign it. “To sign in its present form may be the wrong thing for generations of West Indians,” he said.

He said that in the final stages of the Cotonou negotiations, after looking at all of the options, it was stated that there might have not been an EPA at all. Provision was made for it in Article 37 (6) in the event the EU would examine all alternative possibilities in order to provide these countries that are not signing the EPA with a new framework for trade, “which is equivalent to their existing situation and in conformity with WTO rules.” The EPA before the region, he said, was not equivalent to the existing situation.

He said reciprocity was recited throughout the text like a mantra, but he felt the Europeans would know that reciprocity required not equity but proportionality.

Gill explained that while reciprocity was mentioned it did not mean full reciprocity but asymmetrical reciprocity.

Calling the EPA anti-development, Sir Shridath said it would become a benchmark for future negotiations with other developed nations. “This is an agreement with the world. It is a global giveaway,” he said adding that “at the very least signing onto the EPA is premature. Whistling in the dark is sometimes understood but signing in the dark is positively reckless.”

On ACP solidarity, he noted that the ACP was conceived in Brussels by the Caribbean and came into being 33 years ago in Guyana with the Georgetown Accord and the Caribbean being the trustees of the ACP charter.

Noting African solidarity with the Caribbean over the years and particularly on the issue of the rum industry, which would have had a negative impact on Guyana, he suggested that the region collectively put signing of the EPA on hold. “Is our partnership with Europe now more special than with the ACP? ACP solidarity is not an abstract concept,” he said.

He posited that the EU needed the six EPAs even more than any one region needed it.

Guyana could be isolated for its stance on the EPA – Sir Shridath

Guyana could be isolated for its stance on the EPA – Sir Shridath

Stabroek News. September 7, 2008 @ 5:21 am In News | 3 Comments

Guyana is in danger of being isolated because of its opposition to signing the Economic Partnership Agreement (EPA) between Cariforum and the European Union in its present format and this could have serious implications for regional integration.

Responding to a question from the floor at the national consultation on the EPA at the Guyana International Con-ference Centre, Liliendaal on Friday, panellist Sir Shridath Ramphal, said that what Guyana does or does not do in relation to the EPA has implications for regional integration.
Sir Shridath has called for the signing to be put on hold until after the grouping of African Caribbean Pacific (ACP) Heads meeting in Accra, Ghana on October 2.
Asked what the implications would be for Guyana, Sir Shridath, who is based in Barbados, said it would have been easier to answer the question if the region were united but “we have to acknowledge that the region is badly divided. And in fact Guyana is in danger of being isolated and that will have serious consequences for regional integration.

“Our priority should be consummating the Caribbean Single Market and Economy. That is what we have committed ourselves to, fundamentally, in terms of regional integration and that should be our guiding star.”

The real value of Friday’s consultation, he said, was that it should arm President Bharrat Jagdeo with the sense that the present initialled EPA was unacceptable; that what was needed was a regional consensus and that the EU has to be re-engaged in renegotiating an alternative acceptable to Guyana and that is a goods-only agreement.

He did not accept the EU’s position that the region had to sign the agreement or face the consequences of tariffs and the Generalised System of Preferences (GSPs) and said it was clear in international law that having initialled the agreement it was open to the parties to agree to be bound by part or all of the initialled text. As such, he said it was incumbent on Caricom and the EU to agree to look again at the possibilities, for example, of a goods-only agreement.
He was convinced that if the region was united in the request for a standstill on the rest of the agreement the EU would negotiate that. “They could hardly refuse it having agreed to do it with so many other regions,” he said.

However, if a part of Caricom was prepared to consent to be bound by only a part of the agreement and another for signing the entire agreement, “that then becomes an issue of considerable difficulty both for the European Union and for Caricom.”

Because of such a scenario, he said, he suggested that no decision to sign be taken on September 10, 2008 in Barbados when Caricom heads meet but that they seek to engage the whole body of the ACP on where the grouping stood in relation to the EPAs. Guyana, he said, should use the Barbados forum to say that the ACP heads were meeting in two weeks in Accra and the region must seek to engage them in the discussions.

There was the possibility that there could be a collective response, which would help to shape the region’s response to Europe. “Europe then has to listen. This agreement is of importance to Europe. We must not think in the context of take it or leave it; that Europe is quite happy with our leaving it, they would not be,” he said.
Answering the same question, the Antigua and Barbuda-based Sir Ron Saunders said much depends on how the EU would respond to Guyana and what its partners in Cariforum would do. If the Caribbean would stand with Guyana and say it accepted that Guyana would like a goods-only agreement and recommend that to the EU, it would have a chance of withstanding the statement made by Deputy Director General for Trade, European Commission Karl Friedrich Falkenburg that the EPA as currently negotiated was virtually a take it or leave it situation.

The question Guyana’s political directorate has to ask itself, he said, was whether it could rely on the support of its Caribbean partners. “I suppose that would be answered on Wednesday when President Bharrat Jagdeo meets other Caricom heads in Barbados,” he said.

He was not sure how reliable the ACP would be, but added that should Guyana gain the solidarity of the Caribbean then Guyana should hold out and if at the ACP there was solidarity, then Guyana could continue to hold out. The question that Guyana has to ask itself and those who said that Guyana should stand up, he said, was what would happen if the EU applied the GSP to sugar and rice. And in the next few months if the economy began to go slightly haywire, would the people then stand up with the government.

He said he did not think that the Guyana government would want to make that kind of decision without the concurrence of the opposition parties and the trades union movement because when the pressure was on all would have to bear it collectively.

Falkenburg, in his response, reiterated that the EU was not imposing an EPA on the region but that it had been negotiated between the region and the EU with its background in the signing of the Cotonou agreement in 1998. The understanding, he said, was that the Cariforum countries would have negotiated an EPA by December 31 2007, that it would be WTO compatible and address investment, services and other issues. Having been jointly negotiated, he said, it was not a diktat as the consultation, which involved a technical team, a ministerial team and even Caricom, appeared to have been making out.

Europe, he said took the unprecedented move to grant market access to Caribbean goods even before the signing of the EPA took place, in good faith at the end of last year with the expectation that the agreement would be effectively implemented. “On that basis we took the risk of putting in place market access for which we could be criticized in the WTO. It is illegal under present WTO rules. Now we have done that because we are committed to the WTO negotiations,” he said.
He said Europe would “deplore very, very seriously if this negotiating result we have achieved after so many years of negotiations would fail.”

The EU, he said, was a player in a multilateral trading system that was collectively designed and under the system, Europe could not maintain market access without the justification of a free trade agreement negotiated, signed and notified with the WTO.

At this point, President Jagdeo intervened, even though the session was being chaired by his advisor on governance, Gail Teixeira, and reiterated what he, Jagdeo had been saying all along that the region could preserve the market access and still be WTO compatible. This was Jagdeo’s second intervention and it prevented Falkenburg from addressing the issue of ‘Most Favoured Nations’; which came as a question from the floor.

Jagdeo said he would be happy if Europe dropped the pretence of development, which it claimed as part of its policies. Lectures on the Millennium Development Goals, environmental issues among ethical issues, he said, were all false. “My point is I am going to continue to battle this,” he said adding that he would refrain from speaking across the region in countries that have agreed to sign the agreement and would argue for a goods-only agreement.

“I want Europe to take me off the list - Annexe One — because I say I want only a goods agreement in Guyana’s case. Take me off that…,” he said contending that he was not alone in the region in his view and that other countries had grave concerns.

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Auditor General’s Report - Conclusion

Business Page
Auditor General’s Report - Conclusion
Posted By Christopher Ram.
Stabroek News. On September 7, 2008 @ 5:14 am In Features, Sunday | No Comments

Today we conclude our 3-part review of the Auditor General’s report for 2006. I apologise for presenting a rather disturbing picture of the financial management of the country that stands in stark contrast to the oft-repeated boast of financial probity and accountability. What makes matters worse is that measured by tax to GDP, Guyanese pay considerably more taxes than any other country in Caricom and these are among the highest in the world. And for VAT alone, Guyana stands out among the Caricom countries with the share of GDP that is collected in the form of VAT being three times that of Trinidad and Tobago, a country which has had VAT for over fifteen years. This is no doubt, in part due to the required rate of VAT to meet the revenue-neutrality commitment by the government being considerably more than it should be. The government knows this and has been reminded of it on a number of occasions but has simply ignored it. After all, it considers the press as financially illiterate so what does it think of the rest of us Guyanese?

It is almost pointless identifying all the weaknesses in the report itself, in the scope that it appears to consider adequate to make a proper conclusion, and in its findings. We note that the Office of the Prime Minister which spent one hundred million dollars in 2006 does not warrant any mention in the report, but what about the Privatisation Unit/NICIL as the Ministry of Finance chooses to call it, and which does not account for hundreds of millions of dollars it collects and spends unlawfully year after year. There is not a single mention of this fundamental breach of the constitution that ranks and rankles with the infamous Lotto Funds.

Yet in paragraph 325 the report finds space and time to commend the GDF for achieving a Nil balance on its salaries account for four of twelve months in 2006! That a failure rate of eight out of twelve in respect of this most elementary principle of book-keeping is regarded by the Auditor General as “commendable” is an indication that the bar set by the report for accountability is so low that it can cause even the walker to stump her/his toe!

The report indicates a poor understanding of the laws and operation of the Guyana Revenue Authority by its failure to address some real and fundamental issues, and even when it does present some findings it is unable to put a meaningful interpretation on them. Take for example the section of the report dealing with Customs and Trade Administration. Eleven of the thirteen paragraphs deal with “Prior year matters which have not been fully resolved,” with the adverb seeming overly generous. The report appears oblivious to the several scams that take place in that division costing the state billions of dollars in funds which could have gone to reduce the prohibitive VAT and PAYE borne mainly by low-income taxpayers.

The story is not too different with the Internal Revenue Department, which according to the report has not taken steps to have all delinquent self-employed persons comply with the Income Tax Act, one of the reasons given for the merger of the tax-collecting agencies in 2000. The report tells us that there are 22,682 persons who have been identified by the GRA as self-employed, but it does not bother to tell us how many filed returns. There is no reason why the GRA with the technical, IT and legal professionals, and the enforcement and penal provisions at its disposal could not achieve a 75% filing performance. But let us assume a 50% rate of filing, the average tax collection per person is a mere $7,500 per month per taxpayer or the equivalent of about $50,000 per month of profit! Is it not time that the GRA prosecute those accountants and tax consultants who aid and abet the criminal act of tax evasion? I do not believe that any serious Audit Office and GRA would find this credible, but I am surprised that the report does not highlight it and give any indication of the steps proposed to deal with what is obviously a scandalous situation.

The QAII debacle and the preferential treatment of New GPC should have alerted the Auditor General to the need and the statutory requirement for a proper audit of the tax concessions given under various acts. The Auditor General would know that in the absence of Goods Received Records he could have applied alternative methods of testing the purchase of these items with a value in excess of $600 million, including obtaining from the supplier, the New GPC, copies of their invoices and delivery records. Failure to do this reflects very poorly on him.

The report ignores this and does not deal with the fact that the system of tax refunds is a joke and an injustice to the taxpaying public. And should the report have noted that there has not been a Board of Review for several years or that the last Chairman, Mr Brindley Benn, is not known to have any expertise in this crucial area? One only has to read some of the decisions coming out of the Board of Review of other Caribbean countries to recognize the calibre of persons who should be appointed to such a body.

If one is serious about the finances of the country the two entities charged with managing and accounting for these funds – the Accountant General’s Office and the Ministry of Finance cannot be allowed to be the featured stars in this tragic-comedy of errors and incompetence. Many of the discrepancies highlighted (and not highlighted such as the requirement to submit to the National Assembly a mid-year report by August 30 each year), in the report can be traced directly to one or the other of these two entities. Only a sprinkling of examples is required to show the scale of the problem: no financial statements produced for audit in respect of the State Planning Commission for 1992-2006, $6.513 billion shown as advances from the Dependants Pension Fund Deposit Fund outstanding at December 31, 2006 could not be substantiated and the old Consolidated Fund bank account NO 400 not reconciled since 1988. And what has been the solution by the new breed of financial literati? Open new accounts and do not bother to reconcile those either. So you now have an untold number of bank accounts, most of which are not reconciled and 108 accounts which are listed as inactive.
Of the $16.5 billion available to Ministry of Finance, only $3.6 billion was spent, which reflects either incredible money-management skills or a hopelessly flawed budget process, which prior to his elevation as Finance Minister was under the control of Dr Ashni Singh as Budget Director. A loan of $2.617 billion from the International Development Association was placed into an account in December 2003 for “investments in human capital under the health and education sectors; (b) strengthening of public institutions and improvement of governance (c) expansion and improvement in the provision of basic services under the water sector; and (d) broad-based job-generating economic growth.” Laudable projects, all except that there have been no transactions on this account since and the country must surely be paying interest on that loan. This ignores the even greater price in the loss of benefits that would have been generated by implementation of the initiatives contemplated when the loan agreement was signed.

Not only are all the issues raised under the section dealing with the National Procurement and Tender Administration (paragraphs 108-122) and that dealing with the Integrated Fiscal and Management Accounting System (IFMAS) matters coming forward from previous years, but these are matters for which the Minister of Finance is responsible. Not only has the constitutional body, the National Procurement Commission, not been set up, but as we see from paragraph 116 of the report, the Minister of Finance did not insist that the Chairman of the National Board submit the annual report required by the Procurement Act on the effectiveness of the procurement process!

The AG’s opinion
Despite all the weaknesses, omissions and failures, the opinion expressed on the report is a mixed opinion involving one in which the Auditor General (ag) claims that “subject to” the massive errors and omissions some of the statements present fairly the financial transactions and positions on some of the accounts and statements, but in relation to others he could not form an opinion.
Among the former is that relating to the Receipts and Payments of the Consolidated Fund and Receipts and Payments of the Contingencies Fund. As an auditor who first entered a profession which I have practised in several jurisdictions since September 1974, I simply cannot see how a “subject to” opinion can be issued where there are such fundamental breaches of the constitution and other laws and where billions of dollars are not properly accounted for. These would include funds collected by the Georgetown Public Hospital Corporation, foreign missions, royalties, privatization proceeds and Lotto Funds.

And imagine that the government which has retained VAT funds from the consumers is unable to reconcile the majority of bank accounts and that the balance of $8.774 billion “represents the best available estimate of the cash position of the Government as at December 31, 2006.” Should this amount be $50 billion or $50? The answer is that no one knows for sure. The unfortunate remarks by our President referred to in the first two weeks of this analysis send the message that knowing how much money the country has is unimportant. The absence of control over the bank accounts appears to substantiate that belief.

Where do we go from here?
No useful purpose would be served by listing the many unacceptable conditions cited in the report. Suffice it to say that this report should be a wake-up call to all Guyanese and more particularly the parliamentary opposition and the government of the need to address an untenable situation. We keep hearing that scarcity of resources constrains the effectiveness of financial oversight, and we are now painfully aware of the persistent failures of the Accountant General’s office, the Audit Office and the Ministry of Finance. As previously mentioned these are the entities tasked with the responsibility of managing, accounting for and ensuring that the nation’s resources are adequately protected. Immediate reforms in the way they do business (and it is business) are needed. The first statement of intent would be the allocation of resources to enhance the capability of the entities. Despite all the cries of scarce resources, this report highlights the abuse and misuse of resources and the critical need for strengthening the capability of the three entities. If accountability is job number one, then the President as the Chief Accountable Officer must ensure that the Accountant General, the Auditor General and the Minister of Finance are given the tools needed to discharge their constitutional and statutory responsibilities.

The system requires the ministries and other government entities to respond formally by way of a Treasury Memorandum to the report of the Public Accounts Committee following its own review of each Auditor General’s report. When after several years of non-compliance by the PNC and itself, the government published the first such memorandum in 2006 there was much crowing, so it is troubling that the government has failed to respond to the last report done by the PAC. Taxpayers and citizens have a right to know the proposed measures to address the deficiencies in accounting, accountability and governance. Having done a mere superficial review of the report, as a taxpayer I am appalled at the way in which my taxes are spent. I would willingly pay anyone for advice on the legal recourse I have as a citizen and it is truly time for the country to wake up from the party which it financed to the tune of hundreds of millions of dollars and get serious.

Faced with this scandalous financial situation, the Public Accounts Committee has gone into recess, but it too needs to recognize that it cannot be business as usual. It needs to get the technical expertise to assist it in its work, and it needs a full-time secretariat in order to exercise its constitutional authority. It should call the Auditor General to discuss his report, the capability of his department and the glaring shortcomings that have surfaced as a result of his continued inability to carry out his constitutional mandate. Business Page can hardly wait to see whether the situation provokes as visceral a response by the President to correct the situation as was his reaction to perceived criticism of the report. It will be a true barometer of the seriousness of his administration about accountability.

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Is there life after Carifesta? Wednesday’s Ramblings

Wednesday’s Ramblings
Stabroek News. September 3, 2008 @ 5:02 am In Daily, Features | 3 Comments
Is there life after Carifesta?

And so we come to the end of Carifesta… the curtain comes down on a spectacular ten days of art and culture and we bid adieu… Aaaaaagh! Aaaagh! It’s over (sob, sob) Please! Please! Carrie, don’t go! Don’t leave us! We’re sorry we made fun of your song… it really has the most original lyrics, and the chorus line is not a form of psychological terror! Look we’re going to sing it for you! “Carrrrieee! Carrrieeeeeee Festa! One people, one leader, one Leader! ”Sorry, we could not help it; we got you confused with Bharratfesta. Don’t go! Don’t go…. Oh no, she’s gone… Carrie… Carrie… (Sob, sob) we’re all alone, all the artists, the dancers, the musicians those beautiful happy people have gone and left us on these mudflats. Even the worm-eating Amerindians in their luxury $20 million village have gone home to their real village made out of the same material at a fraction of the cost.

And now, it’s a grey Monday morning… what now dear leader? Oh wise one, guide the people as to what they must get hysterical about next. Let’s go through the list: CWC tick, VAT tick, TIN tick, Numerous criminals with ridiculous names tick, Global Warming tick, Grow More or Die tick, the EPA tick… uh oh the list is exhausted. They need something big, something they can all get involved in.

Some fast-moving tropical disease, perhaps? Something that will demonstrate the astonishing capabilities of this government. We only hope the Berbice bridge opening will allow for a week of government-sponsored wine down.

Just tell the people and they shall follow. Order them to go en masse to the national stadium and watch the grass grow (have it sponsored by a fertilizer company). The Chronic would call it spectacular.

What did you say at the closing? We must return to the mundane task of nation building. Mundane? Oh no… no sir…we beg to differ, Guyanese are excited, filled with a new purpose and a massive hangover to begin again building this nation, one broken water main, one serially pot-holed road, one newly built collapsed bridge at a time. No task is beyond this nation’s reach as long as it does not involve electricity, education and crime. Fetes, international sporting events…they’re a snap.

So please, El Presidente could you arrange just one more week of freeness, dancing and drinking? You know as a Moscow trained economist that this splurge of government spending, (you take $500 million of taxpayer’s money out of the economy and send it right back in) is not the zero sum game it would appear on paper. It multiplies throughout the truly long lasting, productive sectors: beer, rum, hair salons, boutiques and Red Dragon.
And what a shining example of public/private partnership, the mega concerts were. For example, you invited the company that imported soda pop/beer to hold a concert for which people had to buy the same soda pop/beer to receive a ticket. This demonstrates how even-handed you can be even as your investigation into the customs scam grinds to a halt.

The performers stay in the hotel you helped finance with our money and thereby reduce the hotel’s interest-free loan in a way that is impossible to verify.
Then you get the newspaper whose owners your government gave illegal tax concessions to, to join an unquestioning cheerleading chorus for Carifesta along with your personal TV and radio stations.

Let’s not even mention the Chronic, which ignored everything else in Guyana for ten days as it entered the magical world of Carifestaland. Not even the killing of those criminals – what are their names again? - could crash their party.

No wonder it was a success. You proclaimed it was a success, the biggest ever… like your budgets, your tax revenues, and you were everywhere, omnipresent: you quarrelled with Walcott, avoided auditors at the Grand Market, addressed the gospel fest, declaring the country was in safe hands …you meant your hands of course, not God’s. Ha ha silly us!

And the crowds! The multitudes came out for you, for your country. After all 30,000 people at the Banks Ultra Mega Concert-to-end-all-Concerts can’t be wrong! And in the process, they made the PNC look like fuddy-duddy party poopers.

The bourgeoisie carped about the poorly attended symposiums, the near empty visual arts exhibition, the cancelled performances. But all that arty-farty stuff meant nothing. The stadium was the true reflection of what culture is in the Caribbean, why fight it? Why lament its so-called decline? Decline from where? Elitist European standards? Why try to raise it? It is what it is.

Especially when a superstar with roots deep in the Caribbean, Akon, can come to reinforce the apparent new values of the region: being locked up and bootylicious. (In passing, he has greatly embellished his criminal record claiming to have been locked up for three years as part of a “notorious” auto theft ring that stole luxury sports cars. In fact, his only conviction was three years probation for gun possession. He spent five months in a county jail for driving a stolen BMW but the charges were dropped.

See this article [1]
So what a fitting end: a lip-synching serial fabulist makes everyone wait until daylight (He was so late he ran into children trying to make the first day of school) to hear songs with such traditional Caribbean lyrics as:

“Girl and while you’re looking at me I’m ready to hit the caddy right up on the patio move the patty to the caddy, baby you got a phatty the type I like to marry wanting to just give you everything and that’s kinda scary, cause I’m loving the way you shake your ass, bouncin’, got me tippin’ my glass…”

Or this: ‘The way she climbs up and down them poles Looking like one of them putty-cat dolls Trying to hold my woodie back through my draws…”
Now that’s real poetry! Real culture!

Let the old poet grumble about development and hotels. No one can hear him. The music’s too loud.

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