EU releases stalled G$2 billion to Guyana

By Kurt Campbell

 With the return of parliamentary oversight, which was absent in Guyana since the passage of the No-Confidence Motion in December 2018, the European Union (EU) on Thursday released G$2 billion to Guyana for budget support.

President Irfaan Ali and Senior Minister with responsibility for Finance, Dr Ashni Singh, joined EU Ambassador to Guyana, Ponz Cantó at his Bel Air Springs residence and expressed gratitude for the EU’s confidence in Guyana’s ability to exercise good fiscal management of the funds.

Dr Singh, who will have direct responsibility for the funds once it is deposited into the national treasury, said it was important to recognise the involvement of the People’s Progressive Party Civic (PPP/C) government in making Guyana eligible for the budget support in the first instance.

This latest $19.8 billion payment brings the total grant funds released since 2017 to G$51. 6 billion. The total overall amount of the EU budget support for the Integrated Coastal management is G$74. 5 billion.

Dr Singh pointed out that this payment is made possible by Guyana’s fulfilment of a comprehensive and demanding set of requirements.

“It is an instrument of development support to countries that have demonstrated and meet the prerequisite in relation to good governance, the stability of fiscal oversight and good financial management… this is testimony that Guyana has good and sound systems for managing public funds,” Dr Singh said.

Dr Singh, who served as Finance Minister in previous PPP governments, said it is unfortunate that the disbursement was stalled because of developments since December 2018 when a No-Confidence Motion was passed in the National Assembly, toppling the then APNU+AFC coalition government and removing all parliamentary oversight.

That situation lasted for almost two years up until August 2020.

“This country was found unable to secure the disbursement because of the absence of parliamentary oversight…I want to say now that this government intends to work hard to qualify for every cent of budget support,” Dr Singh added.

Meanwhile, President Ali said it was important to recognise that the money is being disbursed at a time when mobilising resources is extremely difficult globally. He welcomed the disbursement of the funds, which will go towards Guyana’s coastal management and effecting repairs to stretches of Guyana sea defence (sea wall).

“The pandemic has indeed caused tremendous socio and economic hardship and financial constraints on countries. It has affected countries negatively and the state of indebtedness has worsened along with the ability to repay debts… it is impressive that at this time when there is a global call for rescheduling of loans and loan payments the EU has been able to mobilize this disbursement,” President Ali said.

The Head-of-State said too that Guyana would look to ensure that the funds, once received, and added to the national budget, will go towards the purpose that it is intended.

Ambassador Cantó said talks that Guyana does not need the support because it is the newest oil-producing nation is far from the truth. He said there are many needs and the EU stands ready to support Guyana on fulfilling those needs.

Cantó said it is expected that Guyana will use the disbursement for the progress and wellbeing of its people.  This, he said, must be done in the spirit of inclusivity and reconciliation.

“It is time to look towards the future. As friends of Guyana, we would like to see Guyanese growing together,” he said as he recalled the recent protracted elections period that exposed the country’s divisiveness.

The EU and the Government of Guyana have reached a milestone in the implementation of the current budget support through this latest payment.  This should provide a major contribution to the inclusive and sustainable development of the Country, and substantial fiscal space for the Country finances, in the context of an unprecedented COVID-19 crisis.