Manufacturing and agro-processing are defined in this National Development Strategy as the application of technical knowledge and processing equipment, in alliance with capital and labour, to the transformation of locally available or imported raw materials and/or intermediate inputs, into final or intermediate products. These include agricultural (marine, forestry, livestock, crops), industrial and mineral materials.

17.I.1.1 Guyana is manifestly rich in commercially exploitable natural resources. Moreover, North America, Western Europe, and the islands of the Caribbean appear to offer immense market opportunities for manufactured products via the enabling CBI, Lomé and CARIBCAN arrangements and the CARICOM single market. On the face of it, therefore, Guyana could readily develop the required competitive advantage for the production and export of manufactured products. In spite of these potentialities, however, growth in the manufacturing sector has been limited. Indeed, with the exception of bauxite processing and sugar milling, the sector has not contributed significantly to the gross domestic product of the country.

17.I.1.2 In Guyana, the secondary sector’s share of GDP was actually higher in the period 1950-75 than it has been in recent years. In part, this has been because of the absence of rational and conducive policies at the macroeconomic level specifically for the manufacturing sector and, in part, because of the failure of local investors to display the required initiative. Nevertheless, in recent years, the number of manufacturing units has risen significantly and, in key subsectors such as engineering and wood products, there has been noteworthy expansion in average plant size. Moreover, while natural resource-based subsectors, such as wood processing and agro-processing, account for the bulk of the employment in manufacturing, there are other subsectors of importance, such as textiles and metal working.

Minerals, Sand, Stones, Rocks and Clays

17.I.2.1 Although Guyana is well-endowed in mineral resources, the only minerals exploited to date on a commercial basis have been manganese, bauxite, gold and diamonds. Semi-precious stones are available extensively but are not yet utilised in any meaningful amount. Petroleum is known to exist but is not commercially produced. There are widespread deposits of clay types suitable for a variety of ceramic applications, but only a few are being used. Apart from construction and recreation, for which it is being used locally and exported in small amounts, sand is also a vital raw material in the manufacturing process which is virtually neglected in the manufacturing process in Guyana. Bauxite and gold are the only products from the earth which have been subjected to some amount of processing and yet, all these products have significant long-run potential as inputs for enhancing the contribution of the sector to Guyana’s development.

Marine Products

17.I.2.2 The marine subsector has been a cornerstone of the economy in processing and exports for a number of years. It includes plants for the processing, deep freezing, packaging and storage of prawns, seabob, and some finfish. The bulk of the prawns caught are beheaded and/or shelled, blast frozen, packaged and exported to markets in North America.

Forestry Products

17.I.2.3 Products derived from wood draw upon the extensive forest resources of Guyana. The forest products subsector is highly segmented and embraces logging, sawmilling, plywood manufacture, charcoal production, furniture manufacture, and prefabrication. Sawmilling and plywood operations tend to be vertically integrated. In recent years, the subsector has attracted significant foreign investments, inducing extensive competition in the market, and forcing local firms to upgrade their technologies and improve their management systems in the battle to retain and improve their share of the market.

17.I.2.4 The most positive developments in the subsector, over the last dozen years or so, are the emergence of plywood as a principal export, and the expansion of production and export of furniture.

Dairy and Livestock

17.I.2.5 Some of the production centres for dairy and livestock, inclusive of beef, mutton, pork, poultry, eggs and milk, are spatially mismatched in relation to the demand points. This is particularly true of beef, in which the country largely satisfies its needs. There is significant importation of chicken and eggs from North America, and milk products from Europe.

Dairying

• Dairy production is concentrated along the coastal belt in order to facilitate quick access to markets. There are only three large commercial units with modern milk processing facilities. Two of these companies do not appear to be effectively run. The bulk of the existing milk production comes from farmers located in close proximity to Georgetown, with between one to twenty-five head of cows.

Beef

• The Rupununi has immense potential for the expansion of beef production. The realisation of this potential has, however, been somewhat stymied by the region’s inaccessibility to markets. The completion of the road to Lethem and the lifting of restrictions on air traffic will provide great assistance to production in this area in the future. However, despite the experience of the Rupununi, beef production has been on the increase overall.

Mutton

• This is the least popular meat in Guyana. Recently, however, demand for it appears to have surged. In the Guyana context it is not a versatile meat that readily lends itself to processing activities. This may change in the medium term as tastes become more sophisticated, and as the demand for meats in general continues to grow.

Pork

• Pig farming is generally small in scale and is, as a rule, part of mixed farming operations. Pork is the third ranking meat by volume. Two large operations have modern facilities for the dressing and packaging of this product, and for the manufacturing of ham, bacon and sausages.

Chicken and Eggs

• By far the most popular meat in Guyana is chicken. However, the expanding production only partially satisfies ballooning demands, the bulk of which is met by imports from North America. Imports also account for most of the eggs consumed locally and for those used for the reproduction of meat birds and layers. This component of the subsector is dominated by medium-sized farms which rear between one thousand and five thousand birds on a batch basis.

Processed Foods

17.I.2.6 Guyana boasts an extremely wide variety of foods which are manufactured locally for both the domestic and export markets. The traditional products have been rice and sugar. However, although there has been a most significant increase in the production of non-traditional foodstuff (juices, beverages, condiments, jams and jellies, and starch powder) because of liberalised trading policies, the influx of foreign products has not abated. Moreover, although the quantity and value of non-traditional exports have consistently risen, over the last decade or so, demand has consistently outstripped supply for both domestic and overseas markets.

17.I.2.7 The New Guyana Marketing Corporation is responsible for advising farmers and manufacturers on production, processing and the marketing of non-traditional agricultural products. However, this institution does not have sufficient human and capital resources to dispense its mandate effectively.

17.I.2.8 Entrepreneurs engaged in local agro-processing are generally motivated by identifying niche markets particularly in the Caribbean and North America. However, greater emphasis ought to be placed on high valued products outside niche markets. Additionally, market research ought to focus on "off season" produce in North America and Europe. Mexico, Central America and Kenya have effectively utilised this strategy to export tomatoes to the USA and vegetables to Europe during seasonal "windows".

Metal Fabrication, Foundry and Machine Related Products

17.I.2.9 This subsector has been gaining momentum over the last decade or so, primarily because of the high cost of procuring metal products from overseas sources.

17.I.2.10 The major concentration in this sector is the manufacture of brass, iron castings, and pumps; and the fabrication of equipment for the sugar, rice and mining industries. Most of the items produced are for replacements or spares and for the repair of engine blocks and crank shafts. However, in more recent times, many companies have installed quite modern and sophisticated equipment and are manufacturing and fabricating top quality parts and components.

17.I.2.11 The scope for the development of this sector is great and new small operators surface on a regular basis to add to the ingenuity and innovation of Guyanese craftsmen who benefit from training courses at the local Technical and Vocational Institutes, the University of Guyana, the GITC and even from overseas training programmes.

Leather, Textile and Packaging Products

17.I.2.12 This subsector is not well developed but has the potential of making a substantial contribution to the growth of the economy. Given the heavy incidence of livestock rearing in the Lethem-Rupununi area, this Region can be seen as a potential area for the development of the leather industry in all its diverse forms (shoes, belts, bags etc.). Leather treatment facilities can be established quite easily and, with the relevant research and development programmes put in place, the prospects for a dynamic leather craft and related industries subsector should be bright.

Beverages

17.I.2.13 This subsector, which includes the distilling and/or manufacturing of soft drinks (aerated beverages), beer, malta, wines and rum, is becoming a very significant contributor to the manufacturing sector. In recent years, a greater degree of competition has been infused into the subsector with the two largest operators (DDL and Banks DIH) now introducing, on a regular basis, beverages of international brand names. Along with these two major manufacturers there is a number of smaller operators, primarily in the manufacture of soft drinks.

17.I.2.14 The manufacturers of the sector appear to be mainly devoted to import substitution. This subsector contributes significantly to the employment profile of the country.

Chemical Products

17.I.2.15 Guyana Pharmaceutical Corporation, the largest operator in this subsector, is involved in the manufacture and dispensing of a number of drugs, most of which are sold locally. There is scope for increased exports.

Paper-Related Products

17.I.2.16 Paper-related activities (printing, publishing, etc.) are undertaken by many computer companies, and Guyana Publications Ltd. They cater basically for the needs of the local inhabitants. Some operations, devoted to the production of simple packing materials, are based on imported paper.

Other Products

17.I.2.17 This category includes the operations of such companies as Guyana Refrigerators Ltd. (GRL), Colgate Palmolive Guyana Ltd., Demerara Tobacco Company Ltd. The important contribution of these to the economic well-being of the country lies in the import substitution nature of their products.

17.I.2.18 Within the context of a much broader and clearly articulated development strategy for the manufacturing sector, a number of small manufacturing entities can be established for the satisfaction of local needs, the important impacts being the saving of foreign exchange and the generation of more employment and income.

17.II.1.1 A review and mapping of the processing facilities and inputs in Guyana would highlight an important inconsistency: raw materials that are meant to be processed are often not located where optimal returns are possible, if the high cost of transporting bulk commodities is taken into account. In other words, processing facilities are frequently not located where there are considerable low cost primary inputs. For instance, there is in Region 2 an abundance of coconuts, cassava, plantains, nibi, coffee beans, carambola, citrus fruits, pineapples and guava which readily lend themselves to the production of oil and animal feeds, pulps, jellies and jams, juices (fruits and citrus), chips, crisps, plantain and cassava flour, furniture, and ground coffee. Yet there are only two old, antiquated manufacturing operations in the Region producing jams and jellies of a quality that are sold country-wide and could possibly be exported. And although there has recently been established a coconut processing plant, there is still scope in the Region for the expansion of manufacturing capacity. The same is true for Region 9 with its vast potential for dried and processed meats, and cashew and peanuts.

17.II.2.1 Industrial estates have already proven their usefulness as a mechanism for the promotion of manufacturing and agro-processing in Guyana. They offer the users benefits of externalities and scale and common services at significantly reduced unit costs. The industrial estates of Ruimveldt and Beterverwagting, where all the sites are beneficially occupied, are cases in point. For industrial estates to succeed, they have to be located at the source of either labour, markets or materials. Moreover, adequate physical infrastructural facilities, such as access to transportation, power, water, and telecommunications are critical. The relative absence of these facilities partly explains why the Government seems to be having difficulty in encouraging genuine manufacturers, as opposed to land speculators, to avail themselves of opportunities at the Coldingen complex.

17.II.2.2 A recent version of the industrial estate which has attracted much attention is that of the science park. These estates are based on the application of high technology, and focus on activities with a high component of value added. Apart from requiring all the conditions that are essential for successful industrial estates, they depend on linkages with research and development institutions which supply relevant technological knowledge and advice. The science park concept will be explored in association with the National Agricultural Research Institute (NARI) and the Institute of Applied Science and Technology (IAST). In the case of NARI, viable ventures could be supported in, for example, the genetic propagation of high value, seasonal exports to temperate markets. Similarly, in the case of IAST, high technology manufacturing could be supported in the electrical and electronic fields. The Ministry of Trade, Tourism and Industry could spearhead their establishment, in consultation with the relevant private sector bodies.

17.II.2.3 The establishment of Export Processing Zones (EPZ) is another mechanism for the promotion of manufacturing and agro-processing, which has already been discussed. Although many CARICOM member countries have long established EPZs the success story of EPZs in the Caribbean is to be found in the Dominican Republic. There the concept, which was implemented in 1970, has been credited with the creation of nearly 200,000 jobs. The static short term gains from an EPZ are largely employment creation and foreign exchange earnings. However, the dynamic gains tend to be more diverse and are derived from the development of linkages between the EPZs and the primary and tertiary sectors. Without strong linkages of this nature, the danger that firms could pack up and leave the EPZ almost always exists. However, on balance, EPZs are strongly conducive to the expansion of manufacturing and agro-processing. The conditions for their success are similar to those of industrial estates and science parks. Hence, they pose no unique set of challenges in terms of establishment and operation. As such, they should be promoted. Here again, the Government, specifically the Ministry of Trade, Tourism and Industry, should consider their establishment and promotion.

17.II.3.1 While the manufacturing and agro-processing sector offers considerable scope for expansion in the future, it appears that at present a significant number of our industries might not be competitive. What is the source of the high costs? In a study which compared the manufacturing cost structure of Jamaica, St. Lucia, Grenada, and Guyana, it was found that Guyana was the least competitive of the countries. And this despite the fact that the wage rates prevailing in our country were the lowest. In Guyana the cost of energy and transport was double that of the other countries; the transaction costs, which include the time spent in consultations with the Government, were deemed to be the highest; and the technology that was generally utilised in the manufacturing processes was considered to be not appropriate.

17.II.3.2 We have to be an export-oriented economy if only because we do not possess a large enough, and rich enough, internal market to consume all that we can produce; if economies of scale are to be taken into account; and if only because it is absolutely necessary for us to earn foreign exchange. Maintaining competitiveness is therefore vital to our very survival. The issues raised here suggest that the very top priority must, accordingly, be assigned to sustaining a policy framework that aids competitiveness. This means that the liberalisation of the economy has to be taken to the point where the remaining vestiges of protectionism which sheltered and nurtured policies of import substitution manufacturing are dismantled, with some provisions being made, of course, for the stimulation of infant industries and the development of certain geographical areas of the country. In addition, we must begin to increase the competitiveness of our manufactured and agro-processed exports such as rum, rice and sugar, that are subject to special preferential arrangements via CARIBCAN, Lomé and CBI, so that we would be in a position to respond effectively to the progressive decline in the level of preference dictated by the inexorable process of globalisation.

17.II.3.3 Adjustment of the sector to a market environment, in which competitive advantages drive output and exports, has become all the more urgent in the light of the irreversible enlargement of trading blocs and the avowed intentions of the WTO. However, the adjustment must proceed in a manner that minimises dislocation in social costs, specifically to the sector and the economy more generally. The proposed policy in manufacturing and agro-processing must address what could be classified as the key challenge to the sector, namely, the transition from protected and preferential markets to the dynamics of the competitive global market place. Once this is achieved, the sector would have been launched on the path to sustainable development.

17.II.4.1 There is also need to focus on the ethical dimension of the conduct of representatives of the business community and, particularly, manufacturers who are also exporters or importers of final and/or intermediate products and/or base materials for transformation. This pertains to the strict and timely compliance with the existing laws, regulations and guidelines laid down by the competent authorities in the public interest. The private sector must recognise that, as its scope to operate is expanded via an improved enabling environment, its response to the ensuing challenge must in part entail a discernible effort to improve corporate behaviour. If this response is not forthcoming, it will become necessary to enforce the laws condignly.

Governmental Agencies

17.II.5.1 At the governmental level, the concerned agencies fall into two categories. In the first category, the apex institution is the Ministry of Trade, Tourism and Industry (MOTTI). The MOTTI is currently the responsible body for the manufacturing sector for policy making, implementing and monitoring. Specific aspects of its sectoral responsibility, such as the one stop investment promotion function and the trade promotion function, are vested in the Guyana Office for Investment Promotion (GOINVEST) and the Guyana Export Promotion Council (GEPC). Neither of these has yet achieved full effectiveness. MOTTI, which itself has retained core responsibility for the sector, does not have sufficient capacity for policy design. Its management is preoccupied with the day-to-day tasks and related activities of the management function, with little policy coherence. At the central level, the Ministry of Finance, through its fiscal, monetary and planning instruments can, and does, profoundly affect the course of the sector. MOTTI has not the capacity to relate to basic issues for the sector at the key political and technical levels. Indeed, there appears to be a distinct asymmetry in authority. Unless some balance is restored, MOTTI may find, when it comes to policy design for the manufacturing sector, that it has the responsibility without the authority to deliver effectively, but remains accountable for sectoral performance. In the present circumstances, it seems necessary to review the effective roles and distribution of labour and authority of these four institutions namely, the Ministry of Finance; the Ministry of Trade, Tourism and Industry; and Go Invest and the Export Promotion Council with a view to making them, together, more efficient and effective. The recent unification of Go Invest and the Export Promotion Council, together with their transfer to the Office of the President does not inspire confidence.

17.II.5.2 The other category of governmental agency is the quality assurance bodies. These are responsible for the setting, monitoring and enforcing of standards and quality principally, but not exclusively, in the manufacturing sector. They include the Food and Drugs Department, the National Bureau of Standards and the Public Health Office of the Municipality, among others. There do not appear to be any inter-linkages among these bodies, and they do not function in the context of a clear Government sectoral policy.

Consumer Entities

17.II.5.3 At the second level, there are the Guyana Consumers Association (GCA) and the Consumers Advisory Bureau (CAB). They are institutionally weak and lack adequate financial support. They attempt, as best they can, to represent public interests in respect to manufactured products among others. The facts that they have no statutory base and their relationship with the Consumer Affairs Division of MOTTI is ill defined, hinder their effectiveness. Despite the similarity in function, there is no interlinking between them.

Private Sector Bodies

17.II.5.4 At the third level, namely that of corporate, private sector interests, institutions have multiplied over the years with the development of the manufacturing sector. There now exist Chambers of Commerce in Demerara, Berbice and Essequibo; the Guyana Manufacturers Association; and the Consultative Association of Guyanese Industry. In 1992, the umbrella Private Sector Commission (PSC) was created apparently to overcome the problems of fragmentation.

17.II.5.5 The PSC would also need to integrate the interests of the other class of private sector organisations with a strong interest in the manufacturing sector as regards policy matters at the level of the various Governmental agencies. These include the Guyana Forest Products Association and the Guyana Gold and Diamond Miners Association.

17II.5.6 A process of continuous consultations institutionalised between these three levels of agencies should be put in place at the earliest opportunity in order to improve on the design and execution of an all-embracing policy for the manufacturing sector. Partisan consultations and the persistence of organisational conflicts will certainly work against a full and beneficial involvement of the private sector in the process of accelerated development of the manufacturing sector of Guyana.

Telecommunications

17.II.6.1 Although privatisation has resulted in some improvement in the provision of telecommunication services, there are still important deficiencies. Telephone services are now supplied on a reasonably reliable basis on the coastland and, coupled with transmitting and related systems for hinterland communication, along with the recent introduction of cellular telephones and beeping systems, a network of telecommunication services is in place which is helpful to manufacturers and, indeed, to the entire country. However, the telephone lines network has not yet been extended to a desired level, and their basic inefficiencies somewhat hamper the process of development in the manufacturing sector.

Energy

17.II.6.2 The state-owned Guyana Electricity Corporation has been recently privatised, and is now the Guyana Power and Light Company. It is projected that its costs will rise at least in the short-term. When it is recalled that the costs under the GEC were so high that they contributed to the uncompetitiveness of the manufacturing sector, this projection of even higher charges seems frightening. However, it is hoped that in the medium and long terms costs will be significantly reduced and that, in addition, the costs now incurred because manufacturers are now forced to install power-generating sets of their own, will be eliminated. It is also fervently wished that the reliability of power supplies would be much enhanced.

Transportation

17.II.6.3 Improvements are being made with respect to road and air transportation, especially to the hinterland areas, which should significantly reduce costs to sector. In addition, water transport has benefited from the rehabilitation and refurbishing of existing ships, etc., thereby making available a more dependable water transport system. When the reforms put forward in the Chapter on Transport take effect, Guyana’s competitiveness in manufacturing will be considerably enhanced. However, there needs to be a resumption in the transport of bulk-cargo. Moreover, limitations on private air carriers need to be reviewed.

17.II.6.4 Manufacturers themselves need to enter into discussions with the ocean freight lines servicing the country on improved rates to North America and Western European destinations.

Water

17.II.6.5 Water supply has been a major deficiency but a programme is in place for its improvement. This will much enhance the sector’s competitiveness.

Basic Education

17.II.7.1 The development of a viable manufacturing sector depends critically on a literate and numerate work force. Such a workforce does not generally exist in Guyana, today. The strategies for returning the country to the standards of literacy and numeracy, for which it was once proud, have been outlined in the Chapter on Education.

Technical and Vocational Training

17.II.7.2 The network of technical and vocational institutions providing training in the array of skills and techniques essential to the efficiency of the operations of the manufacturing and agro-processing sectors is in disarray. All are in dire need of improvements of physical facilities; revision of their curricula, and the introduction of relevant programmes, in keeping with the dynamics of the market place. Above all, a system of management is required which links these institutions with the workplace of the manufacturers.

Tertiary Education

17.II.7.3 The private sector on the whole feels that graduates coming out of the University of Guyana into technical and managerial positions find it difficult to function effectively in the work place. In general there are communication problems; questions about the relevance of the imparted technical and managerial expertise, concerns about leadership quality, and an apparent lack of independence and drive on the part of the graduates.

17.II.8.1 There are significant imperfections in the labour markets. The framework which the labour legislation currently provides is derived from the period of import substitution industrialisation. It needs to be modified to balance better the interest of the two key social partners, with a neutral public authority. Further, as the structure of ownership in the sector shifts over time from the family-owned to the shareholding type firms, industrial relations stability should improve. But it would certainly help for other shareholding firms to review the experience of Banks DIH to see what lessons could be learnt and to put them into practice. Harmony in the sector is a key factor in the competitive market place. Considerations in respect of employee shareholding ownership plans could help the process.

17.II.9.1 The livestock and dairy subsector faces a number of shared constraints to expansion. The first pertains to stockfeed. While rice bran, copra meal and molasses are available, the element of seasonality occasionally generates a mismatch between supply and demand, and thus artificially forces up the price. The key component of stockfeed is protein which is imported as concentrates. It is costly and proper formulae for blending imported inputs with local materials are yet to be worked out.

17.II.9.2 The second constraint is abattoir facilities. The abattoirs under municipal ownership and management are neither sanitary nor functional. The private sector has demonstrated that it can efficiently run such facilities. Both Bounty Farms Limited and C and F Meat Centre have their own modern abattoir facilities which are most efficient.

17.II.9.3 Third, backward integration of the livestock sector is generally insufficient. Yet, as the cases of BFL and CFMC have shown, backward integration contributes significantly to value added. The scope for further processing of livestock products is considerable. While ham, bacon, and sausages are being processed, their quality and variety could be enhanced, and new products, such as dehydrated meats for soup mixes and other manufactured food preparations, introduced.

17.II.9.4 The agro-processing industries can be aided enormously if greater effort is made towards large scale orchard production for crops. Far too often, there is inconsistency in both the quantity and quality of the fruits produced.

17.III.1 The principal national objective for the manufacturing sector is that it increase its contribution to the economy’s overall development. There are three aspects to this broad objective: first, the strategies should seek to promote a rapid increase of production and employment in the manufacturing sector; second, they should stimulate a judicious degree of diversification, in keeping with Guyana’s current and potential comparative advantages; and third, they should lead the wider utilisation of relevant and adaptable modern technology.

17.III.2 Put in another way, the overall roles of the manufacturing sector are to enhance the vertical integration of principal resource-based sectors and to produce a constantly more diverse and widening stream of goods. This means not only expanding outputs such as millwork, furniture, doors and mouldings, veneer, etc., and industrial diamonds, processed gold, polished semi-precious stones and jewellery, it also means reviving former traditions in sectors such as metal working and textiles, building vigorously on the rich base of non-traditional agriculture to produce a variety of processed foods, and introducing over time the manufacture of entirely new products.

17.III.3 Meeting these challenges will be crucial to Guyana’s moving to a higher stage of development in the first decade of the next century. The obstacles in the path are formidable, but the potential is there to be reaped, for the benefit of all citizens.

17.III.4 The operational sub-objectives set out for the private sector as a whole in another part of this National Development Strategy are all directly relevant to achieving the broad objectives established for the manufacturing sector.

Export Processing Zones

17.IV.1.I The creation of two export processing zones, one in Demerara and the other in Berbice, is one of the foundations of this National Development Strategy as regards the promotion of the manufacturing sector. It is essential that the EPZs be located within close reach of a deepwater harbour. Accordingly, the area around the improved port facility in Berbice recommends itself for this purpose. However another will be established in Demerara, once the deep water harbour facilities are created there. This Demerara harbour EPZ appears to be essential if the increased export and import traffic, that is envisaged through the establishment of the road to Brazil, materialises. The harbour in the Berbice River will be deepened, principally by dredging the channel, until the goal of permitting ships of 60,000 dwt to pass easily is attained.

17.IV.1.2 Concomitant improvements in the unloading and warehousing facilities will be pursued in order to be competitive with other harbours in the region.

Competitiveness

17.IV.1.3 These policies are presented elsewhere in the National Development Strategy. They are of the highest importance, if the manufacturing sector is to be made able to prosper in the future. Some of the most important of the policies include labour force training, improved mechanisms for industrial relations, a more uniform and liberal tax regime, and the maintenance of a stable exchange rate over time. It is worth reiterating that, at the moment, the manufacturing sector in Guyana is at a competitive disadvantage vis-a-vis other countries in the region in these four policy areas, and that this disadvantage offsets a significant portion of the cost advantage which Guyana obtains from its relatively low-cost labour.

17.IV.1.4 The corporate taxes on manufacturing enterprises will be further reduced in order to widen the existing differential between the manufacturing and commercial sectors, thus encouraging more investment in manufacturing.

17.IV.1.5 Fiscal incentives for value-added export products will be put in place by way of an export allowance.

17.IV.1.6 Investors will be encouraged, through a package of incentives, to locate their manufacturing enterprises in certain areas of Guyana, (for example, the Intermediate and Rupununi Savannas; and Regions 1, 2,7, 8, 9 and 10), in order to place industries closer to the raw materials wherever possible, to attain an equitable distribution of economic activity, and to occupy our hinterland.

17.IV.1.7 Investors will be encouraged to establish townships within these areas, to facilitate the recruitment of personnel and to provide amenities to workers. These matters are discussed in the Chapters on land and housing.

17.IV.1.8 For a wide range of machinery and equipment the duty and consumption tax rates will be zero.

17.IV.1.9 The duty and consumption tax rates will also be zero on most raw materials imported by manufacturers.

17.IV.1.10 There will be accelerated allowances for capital expenditure, depending on the rate of expenditure incurred.

Institutional Aspects of the Private Sector and Business Ethics

17.IV.1.11 A Task Force will be established to focus on Smart Partnerships, a new framework for encouraging businesses. Such an initiative would encourage community members to work together. International donors may be willing to support an amplified programme of this nature.

17.IV.1.12 A Joint Action Plan will be developed by Private Sector entrepreneurs and Public Sector support agencies to formulate a structure of responsibilities based upon their institutional capabilities. The Action Plan will focus on the Effective Transformation of enterprises and will contain measures to drive value added changes into the enterprise, and increase productivity and efficiency in order to strengthen export led growth.

Regulatory Arrangements

17.IV.1.13 Regulatory mechanisms will be rationalised and intensified in order to standardise and regulate various aspects of commerce and production. These will assist in the elimination of malpractices such as importing expired items and relabelling them. Regulatory batch testing by the FADA will be institutionalised especially in food and food related products including fertilisers, pesticides, insecticides etc.

Industry and the Amerindian Community

17.IV.1.14 Too often in discussions of industrial policy little or no consideration has been given to the possible role of the hinterland communities, including the Amerindians. A more balanced regional development, wherever it makes financial sense, would have the advantage of generating more stable employment and lowering the incidence of poverty in the hinterland. Such development will be based on small-scale manufacturing and agro-processing, and specialised developments such as the proposed regional gold refineries. In this respect, without doubt the completion of the all-weather road to Lethem and the lifting of restrictions on private air services will be essential ingredients of the policy. The potential of the Rupununi, especially in vegetables and livestock products, will be integrated into the rest of the economy, as well as that of other hinterland areas that are endowed with deposits of semi-precious stones and other resources.

Policies for Selected Subsectors

17.IV.1.15 The GGMC and GGDMA will rehabilitate the lapidary operations, initially as a pilot project, to demonstrate their possible commercial viability. Gold and diamonds which are used locally, specifically for the manufacture of jewellery for the domestic market and for informal export will be supported by the following strategy: it will seek (a) to infuse design expertise and state-of-the-art technologies, into the industry, and will train craftsmen and upgrade management in order to reduce unit costs and to break into the higher value market niches and (b) transform the informal into formal exports and expand marketing opportunities.

17.IV.1.16 Again the GGMC and GGDMA will, with the existing manufacturers and distributors and other established parties, detail an operational strategy that would enable the country to capture an increasingly larger stream of the potential benefits which the raw materials in question are capable of offering by way of manufacturing activities.

17.IV.1.17 Government will divest itself of the provision of abattoir services and have them transferred to the private sector on strict performance conditions while strengthening the capacity of the municipal agencies to monitor compliance with tariffs and sanitary standards.

Some Investment Opportunities

17.IV.1.18 Manufacture of high quality wooden furniture in both finished and knock-down forms.

17.IV.1.19 Manufacture of fitted kitchen furniture.

17.IV.1.20 Manufacture of furniture made from lianes (nibi and kufi)

17.IV.1.21 Manufacture of standard sized doors, windows, panels (groove & tongue), and other household fittings.

17.IV.1.22 Manufacture of plywood and veneers.

17.IV.1.23 Manufacture of particleboard

17.IV.1.24 Manufacture of wooden garden furniture.

17.IV.1.25 Manufacture of prefabricated wooden houses.

17.IV.1.26 Manufacture of parquet material and floor tiles.

17.IV.1.27 Manufacture of an assortment of wooden items: toys, coat hangers, clothes pins, walking sticks, wooden brushes, etc.

17.IV.1.28 Processing, canning and bottling of agricultural produce.

17.IV.1.29 Manufacture of chemical products (such as fertilizers, insecticides, herbicides for agricultural production and for use in processing and preservation).

17.IV.1.30 Manufacturing of packaging materials and containers for transport of finished products.

17.IV.1.31 Manufacture of jewellery and ornaments based on gold, diamond and semi-precious stones.

17.IV.1.32 Manufacture of leather products and souvenirs 3.5.6 Ceramics and Non-Metallic Minerals.

17.IV.1.33 Manufacture of articles based on clay, kaolin and silica sand.

17.IV.1.34 Manufacture of garments and textiles for local and export markets (mainly U.S.A. and Canada). This sub-sector is a very dynamic one with over 80% of the companies in the industry being export oriented.

17.IV.1.35 Production of building materials such as stone, cement, clay blocks, tiles.

17.IV.1.36 Manufacture of glass.