With pending tax hike on glass bottles, IDB starts feasibility study for local factory
President of the Guyana Manufacturing Services and Association (GMSA) Ramsay Ali last week said Guyana has received funding from the Inter-American Development Bank (IDB) to conduct a feasibility study to build a glass bottle factory here.
Ali disclosed this on Thursday during an dinner event for the association at the Ramada Hotel, Providence.
The regional supplier for glass packaging, a Trinidad-based business, cannot meet the demands of the entire region, businesses have said. Nevertheless, the company is expanding and the Caribbean Private Sector Organisation (CPSO) recently requested for the taxes on imported glass packaging from outside of the region to be increased.
This could result in a possible increase in prices for all glass bottled products such as rum and food ingredients. Ali said most of the association’s members use glass packaging and as such, it reached out to the IDB and secured funding for the study which will determine whether a glass model factory can be established in Guyana.
“They [the company] approached CARICOM through the mechanisms and said they can produce all the glass in the Caribbean and if you were to import glass from anywhere else you will have to pay the CET (Common External Tariff).
“The companies under our membership approached the IDB and the IDB said yes we are going to fund a study for a feasibility study in Guyana for glass manufacturing. I am pleased to say that study has started and we have a timeline for about two months before we can get the results on that study,” Ali said.
Tariff barriers are taxes imposed by the government on the import and export of goods. Under the Customs Act, Guyana levies a GY $10 environmental tax on every unit of non-returnable metal, plastic, glass, or cardboard container of any alcoholic or non-alcoholic beverage imported into the country.
Ramsay added with the widely anticipated Gas-to-Shore project at Wales, West Bank Demerara, “that project is going to make more sense than if we were to look at it years ago because of the consumption of energy for such a facility.”
The GMSA’s former president Rafeek Khan commenced advocating for Guyana to return to glass production in January. It is his believe that Guyana is on the verge of becoming the bread basket of the Caribbean and manufacturers must take advantage of opportunities that are becoming available.