Jun 09, 2018 News
By Kiana Wilburg
According to oil giant, ExxonMobil, all moneys it invests into the local economy can be considered “local content”. This interpretation is what influenced the list of 227 companies it submitted to the government.
While the company has its own version of what local content is, Minister of State, Joseph Harmon says that the government and the people of Guyana will help fashion the “correct interpretation” of local content. The Cabinet Secretary made this remark during his post-Cabinet meeting which was held yesterday at the Ministry of Presidency.
There, Kaieteur News asked Harmon if Government agrees with the interpretation of local content as portrayed by ExxonMobil in the list of 227 companies it submitted.
The Cabinet Secretary did not comment on Government’s position, but stated that every entity looking at local content will have an interpretation of what it is.
“We are on the cusp of something that is very good for the country and that is the question of defining for ourselves, what local content is. In that regard, discussions taking place in the public space will help us in defining that particular issue.
But the matter of what it is and what it is not, we will eventually come to that point when we have the legislation debated in the National Assembly…”
“I would not like to speculate as to an interpretation, but a publication has been made about companies benefitting from the investment taking place and beyond that I would not wish to state further,” Harmon asserted.
On Monday, Opposition Leader Bharrat Jagdeo called for the Government to publish the list of 309 companies ExxonMobil said it used last year to support its operations. Instead of this, the Government released on Tuesday a list of registered companies used by the oil giant for the first quarter of 2018.
That list includes Kaieteur News, Camex Restaurant Limited, K’s Restaurant, Maggie’s Snackette and Catering, Palm Court Restaurant and Bar, and Pegasus Hotel.
But International Local Content Expert, Rene Tissot told this publication that “ads in newspapers and catering and hotel services are low hanging fruits…”
Tissot said it is important for governments to understand the difference between local content and spending that benefits the local economy.
The Local Content expert said, “If an oil company wants to do advertising for jobs or advertise something about its local branch in Guyana, then they have to utilize the media in that country. You don’t expect them to put the advertisements in the New York Times. Also, there are some services such as those provided by hotels and restaurants that they just don’t have a choice to use. This is money they would have spent anyway and it benefits the local economy. But please, this is not local content. This is money they would have spent anyway.”
Tissot added, “Local Content on the other hand, goes much deeper than this. The heart of Local Content speaks to the development of local skills, the transfer and use of technology, the expansion of local manpower and the growth of local manufacturing. Local Content looks at the ‘value’ of the investment into these areas to such a degree that it is lasting. Local Content in short, promotes industrialization…”
The International Advisor said “the depth of the investment and/or the value of the investment are crucial when referring to something as local content.”
He also stated that a list with restaurants, hotels and media houses would be best described as “shallow in terms of value creation.”
“I would be disappointed to look back 15 years from now and see that local content in Guyana refers to ads in newspapers, catering services etc.”
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