Areas of Opportunity
Guyana offers potential investors – foreign and domestic alike—investment opportunities over a broad spectrum of activities, particularly in export-oriented industries. Opportunities include mature, yet often lucrative sectors, such as mining, timber, sugar, rice and seafood, as well as emerging sectors such as non-traditional agriculture (e.g. fruits and vegetables), agro-processing, aquaculture, value-added wood products, light manufacturing, tourism and IT-enabled services (e.g. call centers, medical transcription). In particular, the enormous growth potential of Guyana’s non-traditional sectors remains essentially untapped. Investors will find doing business in Guyana rewarding if they are able to leverage Guyana’s access to markets, favorable operating environment, and various investment incentives to establish or expand operations in sectors of opportunity.
The Government of Guyana seeks to work with current and potential investors to facilitate investment in the following industries showing growth potential:
• Agriculture and Agro-processing
• Seafood and Aquaculture
• Light Manufacturing
• Forest products
• IT-enabled Services
In its efforts to attract investment, the Government is emphasizing activities that improve efficiency and competitiveness. It is promoting strategies that encourage private income generation, job creation, an increased share of value-added activities in the economy, increased foreign exchange earnings and facilitate sustainable development.
This section presents an overview of the opportunities and reasons to invest in Guyana’s priority sectors. For more detailed information, interested investors should contact GO-Invest (see box 2.1). Contact information and websites for sector relevant public and private organizations are provided in Appendix 4.
|Box 2.1: Go-Invest — Providing Export and Investment Support to Foreign and Domestic Investors
Go-Invest is Guayan’s primary investment and export promotion agency. Go-invest is divided into two divisions, one responsible for Investment Facilitation and the other for Export Promotion.
Investment Promotion Activities
· Act as primary vehicle for investors to liaise with Government agencies during investment process
· Assist invests with steps necessary to commence business operations
· Provide information on investment incentives and regulations relevant to the sectors of interest
· Develop profiles on investment opportunities in Guyana
· Assist investors in obtaining factory space or land
· Assist with coordination of joint venture efforts
· Advise Government on the formulation and implementation of national investment policies
Export Promotion Activities
· Provide exporters with information on trade opportunities in overseas markets
· Help exporters promote their products in national and international exhibitions/trade missions
· Collaborate with exporting organizations to help address export problems
· Recommend measures to the Government to stimulate export trade
· Advise Government on the formulation and implementation of national export policies
· Collaborate with donors to identify and address needs to private sector firms in priority sectors
AGRICULTURE AND AGRO-PROCESSING
Guyana’s vast tracts of productive land present enormous opportunities for growth. Indeed, agriculture already represents a significant proportion of Guyana’s domestic production (approximately 25 per cent of GDP) and agriculture exports amounted to over a third of Guyana’s total exports in 2004. While about 90 per cent of Guyana’s 2005 agriculture exports consisted of rice or sugar products, the value and share of processed goods and fresh fruit and vegetable exports have experienced a positive growth trend in recent years. This is a result of efforts by the Government and the private sector to diversify Guyana’s agricultural sector. With the right investments, Guyana could easily become the ‘breadbasket of the Caribbean’ while at the same time increasing exports to markets in North America and Europe.
Traditional Agriculture Products: Recent changes in the global trading environment, such as the reduction of guaranteed prices for rice and sugar in the E.U., have placed pressure on Guyana’s traditional agricultural exports. Nevertheless, investments in productivity and efforts to shift exports towards non-E.U. markets can help ensure that rice and sugar remain mainstays of Guyana’s economy for some time into the future.
Success Factors for Investment and Growth
Natural Resources – Rich mineral deposits, productive land, forests, sea and rivers, pristine and beautiful environment.
Location – Gateway to South America and the Caribbean.
Duty Free Market Access – Over 75 per cent of Guyana’s exports enter destination markets duty-free.
Language – Only English-speaking nation in South America.
Labour – Competitive wage rates with a literate and trainable labour force.
Openness to Investment – Guyana’s leaders have declared Guyana ‘open for business’ and are taking steps to improve the investment climate.
Sugar: Sugar accounts for nearly 12 per cent of the GDP and over 20 percent of Guyana’s exports (2005). Most sugar exports are destined for the E.U. under a preferential trade agreement. The CARICOM region, which is protected by the common external tariff (CET), is also an important market for Guyanese sugar. Sugar is produced by the state-owned Guyana Sugar Corporation (Guysuco). In 2005, production amounted to nearly 259,000 metric tons. While cuts in the E.U.’s guaranteed prices will have an impact on the industry, a modernization programme with significant investment by Guysuco (see box 2.3) will help maintain the profitability of the sector by raising annual production to 450,000 metric tons.
Although the sector is mature, opportunities still exist in processing the raw product into crystallized sugar, as well as the brown sugar market, which Guysuco reports to be under-served throughout the CARICOM region. Opportunities also exist for the by-products of sugar-based products, such as ethanol.
Rice: Rice accounted for nearly 9 per cent of Guyana’s exports in 2005. Like sugar, Guyana exports rice primarily to Europe and the CARICOM region. According to the Guyana Rice Development Board, this trade pattern is starting to shift following the E.U.’s reduction in the guaranteed price for Guyanese rice. However, Guyana could further expand its market share in the Caribbean; currently it holds 50 per cent of the Jamaican rice market. Furthermore, Brazil is emerging as an important export destination, as the Brazil-Guyana Partial Scope Agreement established a quota for duty-free importation of Guyanese rice. While sufficient Brazilian demand exists, this quota has yet to be met due to a lack of supply.
Opportunity exist to improve productivity by upgrading milling facilities for export so they can manufacture value-added rice products, such as breakfast cereal and quick cooking
Guysuco Responding to Challenges in the Global Sugar Market
Recognising the challenges posed by recent developments in the global sugar market, Guysuco is embarking on the ambitious plan to modernize Guyana’s sugar industry. Guysuco plans to expand and enhance production through a US$165 million modernization programme, including a new US$135 million sugar-processing factory at Skeldon in Eastern Guyana. The company plans to expand sugar cane cultivation on 13,000 hectares of new land while cutting the current cost of sugar production in half. As part of this project, Guysuco plans to include a co-generation electricity plant fuelled by cane waste, as well as a white sugar factory. Guysuco expects overall production to grow by more than 25 per cent over the next four years.