Gov’t pursuing new avenue to help locals amid lengthy payment period from oil companies

President Dr. Irfaan Ali said the Government of Guyana is eyeing the development of a new fund that could help local companies get money while they await payments from oil companies for lengthy periods.

President Ali, who addressed the opening ceremony of the second AfriCaribbean Trade and Investment Forum being held at the Marriott Hotel at Kingston, Georgetown, says the “payment gap” is a bugbear for suppliers.

But with partnerships between the Caribbean and the African Export-Import (Afrexim) Bank growing, he believes that a facilitation fund that has been used by the bank elsewhere can be used in Guyana.

That fund would help companies get much-needed finances to sustain their operations while they await payments.

“…Before the end of this conference, we will have agreements for the establishment of that Local Content Facilitation Fund here in Guyana,” President Ali said during this address at the opening ceremony of the two-day forum.

Lengthy payment periods have been a concern raised locally, particularly in the nascent oil and gas sector. Oil companies were accused of making payments some 90 days after the final provision of goods and services.

This, essentially, requires local companies to fund the costs incurred when executing works – a challenge for new companies penetrating the industry.

Last year, the government instructed contractors to pay locals within 45 days in an attempt to bring some relief to local suppliers.

Meanwhile, Dr. Ali also emphasised the need for the Caribbean and Africa to work closer together to enable both regions to grapple with global problems and fuel their development. Both regions, he highlighted, have been constrained by historic resource extraction and underdevelopment.

Now is the time to cooperate and change that, the Guyanese Head of State contended.