Foreigners using locals to get around local content regulations

Mar 31, 2022 News

Kaieteur News – Less than a month after the Ministry of Natural Resources opened the local content register for Guyanese-owned companies to benefit from the oil and gas sector, foreigners are already finding ways to manipulate and undermine the system.

Private Sector Executive Ramesh Dookhoo

This was highlighted by Private Sector Executive Ramesh Dookhoo on Tuesday, while he was addressing a gathering at a luncheon hosted by the Guyana Manufacturing and Services Association (GMSA) on Tuesday. Dookhoo noted that some foreign companies have begun manipulating systems put in place to ensure Guyanese benefit from oil proceeds under the new Local Content Act.
“Already we’re seeing foreign companies making their staff members, shareholders in the company and doing all things, manipulative things, to qualify for the Local Content Register.” Dookhoo said.
He noted that the authority given to the Local Content Secretariat has to be deeper. “It has to be associated with the Companies Act of Guyana and they must have more authority to investigate companies,” Dookhoo added. Further speaking to Kaieteur News after the event, Dookhoo noted that over past weeks, the issue was brought to his attention.
“There are about three or four complaints about companies that are already on the register. What I think is needed is for the Secretariat to properly investigate companies not in compliance with the law,” Dookhoo noted as he pointed to various practices, which he said are used by foreign businesses, to skirt Guyana’s local content provisions.
In keeping with the new stipulations occasioned by the local content law, the Government of Guyana last February launched a register for local businesses and professionals to advertise their goods and services. The new Local Content law provides for the establishment of a Local Content Secretariat that will develop and maintain Local Content Register of Guyanese nationals for employment and Guyanese companies from which goods and services may be procured.
The law also outlines a schedule that sets out targets of benefits for Guyanese in 40 key sectors to be implemented by the end of 2022. The creation of the register is set to open the door for Guyanese businesses and individuals looking to gain easier access to the oil and gas sector.
These two registers, as stated in the law, will deal specifically with the procurement of goods, and secondly, the provision of skills and employment. Back then, Minister of Natural Resources, Vickram Bharrat had explained the mechanism will pave the way, the oil and gas companies operating in Guyana, as well as their contractors and sub-contractors must procure from Guyanese companies by the end of 2022, 90% of office space rental and accommodation services; 90% janitorial services, laundry and catering services; 95% pest control services; 100% local insurance services; 75% local supply of food; and 90% local accounting services. “… We need a strong Local Content Act in place to ensure that benefits trickle down to every single Guyanese, regardless of if you are a farmer, regardless if you are a welder, mechanic, in the catering business or the waste disposal business – everyone should benefit from the oil and gas sector and the opportunities that arise from this sector,” Bharrat had said.