March 27, 2017

Archives for February 2017

Mayor’s move to have city businesses closed by 16:30h will further cripple private sector – business owners

BY DEVINA SAMAROO

Mayor &CLOIn an announcement that sent shockwaves through the city, Georgetown Mayor Patricia Chase Green declared that city businesses have been operating beyond hours prescribed by the law and the practice must be immediately stopped.

However, the Shops Consolidation (Amendment) Act 2009 states otherwise.

Chase Green told a public meeting on Friday that businesses are forbidden from opening on public holidays, on Sundays and beyond 16:30h (4:30pm) daily; warning that efforts will be made to ensure law and order is restored.

The announcement startled many business operators in Georgetown, some of whom contended that any such move will only further cripple the economy.

One business owner argued that the policy is anti-business and does not cater for working-class persons who usually do their shopping after working hours.

actDuring an interview with Guyana Times Internationalon Monday, the Mayor maintained her position, emphasising that the law is clear.

“They (businesses) open at 07:30h and at seven in the night (19:00h), they are still opened while the law says it’s from 7:00am to 4:30pm (16:30h), and Saturdays are supposed to be half day and there are supposed to be no openings on Sundays; but they are in violation and nobody is saying anything about it,” she argued.

Chase Green said the concerns were brought to her attention by concerned citizens and therefore she decided to take action to put an end to the violation.

The Mayor said she will be writing to the Labour Department about the violation and that it will be up to those in charge to take the necessary actions to correct the breach.

“What you have existing right now is that majority of businesses open after 12 on Saturdays until four or five in the afternoons or until seven in the night. And on Sundays they are also open and on public holidays; and they are in violation… So it is left for them (Labour Ministry) to take that information and do what is necessary,” she stressed.

Chase Green posited, “It is the Ministry’s responsibility, not mine. I am responsible for the market and I make sure that the market is opened and closed on time.”

However, the Chief Labour Officer (CLO) Charles Ogle said the Mayor is erroneous in her claims.

He pointed to the Shops Consolidation (Amendment) Act 2009 which extends the operating hours for regular shops from 07:30h to 22:00h; restaurants and cook shops for 24 hours per day; and parlour, barber and hairdresser establishments from 06:00h to midnight every day.

Ogle presumed that the Mayor is referring to the old Act, which indeed stipulated an early closure time for businesses.

Moreover, he posited that it is the responsibility of the Police Commissioner and not the Labour Department to ensure that the businesses are operating in accordance with the law. He posited that the Mayor may have blundered once again in this regard.

The Shops Act stipulates that “it shall be the duty of the Commissioner of Police to enforce or cause to be enforced the provisions of this Act relating to the hours of opening and closing of shops and prohibited sales.”

 

Controversial Region 9 REO interdicted from duty – Bulkan

afcejjssCommunities Minister Ronald Bulkan has announced that Regional Executive Officer (REO) of Region Nine (Upper Takatu-Upper Essequibo), Carl Parker has been off the job for over one week and that a replacement REO has since been installed.

During an interview with the Government Information Agency, the Minister disputed reports in some sections of the media that Parker was still on the job.

According to Bulkan, Kerwin Ward, formerly of the Region Three administration has assumed the responsibility of acting REO of Region Nine. Ward has been with the Region Three administration for over 20 years and his last substantial position within the Region Three office was Field Auditor.

Parker was on Thursday, February 9, charged for allegedly sexually assaulting one of the region’s elected officials. The sexual assault charge was read to him as he appeared before a Magistrate at the Georgetown Magistrates’ Courts. Following this, Minister Bulkan had informed the media that following the institution of the charge against Parker, he would be interdicted from duty with immediate effect.

It is alleged that Parker, 53, of Cenotaph Boulevard, Lethem, Region Nine, had sexually assaulted a young lady on June 13, 2016 at Yupukari, Central Rupununi, during a village outreach he had hosted. The REO pleaded not guilty.

He appeared before Magistrate Judy Latchman, who read the charge in-camera before granting him bail in the sum of G$200,000.

Speaking with reporters outside the courtroom, Parker’s lawyer, Attorney-at-Law Jerome Khan sought to poke holes in the allegation made against his client, questioning the fact that the incident was only reported in December of 2016 and not when it had reportedly occurred in June.

The defence attorney also pointed out that following this alleged assault, the Virtual Complainant maintained a friendly relationship with Parker, and even visited his home on many occasions.

Khan had told media operatives previously that the accused was a victim and his situation was a “perfect political storm”, intended to remove Parker from his position.

Govt failed to act

During a press conference held earlier this month, Opposition Leader BharratJagdeo accused Government of failing to discipline Parker against whom several similar allegations have been made.

“This Government has serious problems with professionals, particularly young professionals and particularly women. So in (Region Nine, an education official) complained about the (alleged) predatory behaviour of the (official). And it was swept under the carpet,” Jagdeo had stated.

He continued, “Then the (municipal official) complained that she was sexually molested by the same person. It was reported to everyone, including the Minister. The President is aware of it. They try to sweep it under the carpet again.”

At least two arms of the People’s Progressive Party have since come out in solidarity with the alleged victim. These groups – the Women’s Progressive Organisation and Progressive Youth Organisation of Region Nine – expressed admiration for the boldness of the Virtual Complainant in coming forward.

 

Double standards? …Govt reappoints 74 year-old as Guyoil Chairman

Reappointed Guyoil Chairman, Lance Carberry

Reappointed Guyoil
Chairman, Lance Carberry

Former People’s National Congress Chief Whip, 74-year-old Lance Carberry, was recently reappointed Chairman of the Guyana Oil Company (Guyoil).

Carberry was reappointed despite President David Granger’s announcement that Government is reviewing its policy on age and retirement for State agencies, boards and commissions with a view of building a pool of expertise among theyounger generation.

President Granger had made the disclosures on the heels of a major outcry over his administration’s decision to terminate the services of Chairman of the Police Complaints Authority Justice Cecil Kennard who is also over 70 years old.

Granger had argued that Justice Kennard is too old to be functioning and that his Government wants younger professionals to take over these key leadership positions.

“We are simply trying to give other persons the opportunity to serve,” the President provided as his justification.

He also indicated that former Mayor Hamilton Green, who currently heads the Central Housing and Planning Authority and is around the same age as Justice Kennard would also have to step down, in keeping with Government’s new age policy.

Carberry, an economist by profession, had served in the bauxite industry and had played a role in the establishment and development of the Iwokrama Rainforest Project. He is also well-versed in matters affecting the energy and environmental sectors of the economy.

Political commentator Dr David Hinds had argued that Government needs to be clear on its age policy, if it has one.

Hinds said that if Government has a policy on age, then it needs to make it known, while explaining the reasoning behind it.

The political analyst said if the Government really does have a policy where persons who are past a certain age should not occupy some posts, then it should formally announce it and explain to the public the reasoning behind it.

Failure to do so, he said, would open Government to the charge of selective targeting of officials, as appears to be the case with Justice Kennard.

“If there is a policy to remove people from some positions because they are too old, I would have a serious problem with it. Since when age determines competence? When I read the news story about Justice Kennard’s removal because of old age, I thought he was 100 years old and physically and mentally challenged. But, from all indications, despite his so-called old age, the man has been quite competent at what he does,” Hinds said, noting that if indeed he is being removed because of his age, then it is a clear case of age discrimination.

He said if Government is removing Kennard for some other reason, as could well be the case, then it should be honest enough and say so, rather than hiding behind age.

More protests in Georgetown

…this time to challenge Govt’s imposition of 14% VAT on private education

Opposition Leader, Bharrat Jagdeo

Opposition Leader, Bharrat Jagdeo

Parents, students and other concerned stakeholders will take to the streets on February 28 to protest Government’s imposition of 14 per cent Value Added Tax (VAT) on private education – a decision which many are urging to be repealed.

Opposition Leader Bharrat Jagdeo in a statement to the media on Tuesday, called on the Government to reverse the imposition of VAT on private education.

“We say to the Government that if they so badly need revenue, then cut Ministerial salaries, overseas trips by Ministers and per diem allowances of Ministers by 50 per cent. Our children’s education is a more worthwhile investment,” the statement from the Office of the Opposition Leader read.

The missive outlined that education has long proven itself to be the surest and safest vehicle to exit the vicious cycle of poverty and that taxing such a service is callous and cruel.

“We again express our strong dissent to the imposition of VAT on private schools and private educational systems. We regard this imposition as an expression of callousness and cruelty to the children and the parents of those children who are attending these private educational institutions,” the statement said.

Jagdeo’s office contended that the imposition of VAT on private educational institutions would certainly amount to discrimination since, students and parents attending public schools do not bear this burden.

The Office of the Leader of the Opposition reminded that under the People’s Progressive Party/Civic Administration, it encouraged the growth and proliferation of private schools throughout the country out of a firm belief that parents and children alike should have the freedom and option to access education from private as well as public schools and institutions.

It pointed out that as a result, a very strong and viable private education industry has developed across the country.

Protest

Meanwhile, civil society has responded vigorously against the brain tax. Students, parents, teachers, members of the business community and other disgruntled stakeholders will be holding a silent protest outside of the Guyana Revenue Authority (GRA) on February 28.

Persons from the Nations School of Business, Marian Academy, New Guyana School and other private educational institutions across the country have been invited to join the activity – which is expected to be a weekly exercise to voice the nation’s frustrations.

Persons desirous of supporting the cause are encouraged to show up at the assembly point in front of the GRA on Camp Street with their own placards; the protest will commence from 12:00h.

The protest action is just another in a list of activities being taken by civil society in expressing its disapproval of Government’s move to tax education.

Already, a mass online movement is gaining momentum where hundreds of persons have signed a petition against Government’s decision to charge 14 per cent on private educational services.

The organised campaign argued that the imposition of the 14 per cent VAT on private schools will impact very heavily on the children and youth attending those schools.

“For some, the perception is that anyone who attends a private school must be wealthy. That perception may be true for a certain percentage but, for the majority, attendance at such schools often represents a real sacrifice by a family member,” the body explained.

Director of the School of the Nations, Dr Brian O’Toole, highlighted that one of the most popular courses in Guyana, with more than 1000 students, is the ABE programme with courses for school leavers, in business, management, travel and tourism and computer technology.

He said this imposition may force many students to abandon their pursuance of a sound education altogether.

According to the educator, “the only hope for Guyana moving forward is an educated, motivated pool of youth who see Guyana as theirs. This new tax does nothing to further that vision, that sense of optimism, the idea that they can rise out of poverty.”

 

Mr Bulkan is uttering untruths in foolishly denying what he said

Dear Editor,

I wish to respond to a letter by Mr Ronald Bulkan, Communities Minister, in which he accused me of making baseless statements in relation to the Government’s payment to BK International of more than G$1 billion on a mere letter threatening litigation.

Let me say that my statement was based on an article published in the media on August 23, 2016. The front page headline read “Government pays BK US$5.7M on a simple threat”.

The article quotes Mr Bulkan as the source for the headline. It was an interview done with Mr Bulkan by the reporter. The article also carried MrBulkan’s photograph.

Mr Bulkan never denied the story, nor ever asked for it to be retracted. Naturally, one must presume that the article was accurate. After MrBulkan’s letter, I raised the matter with the editor of Kaieteur News and he assured me that the newspaper will hold steadfast to their story.

It is, therefore, clear that it is the Minister who is uttering untruths in foolishly denying what he said, when the same can be so easily confirmed or proven. I hope that the new Code of Conduct, which was promised for Ministers, will address the issue of Ministers, publically, peddling half-truths and even downright lies.

Mr Bulkan went on to point out what was the basis for the huge payment to BK International.That is not the issue at hand Mr Bulkan is attempting to obfuscate. While in Government, I was aware of those figures. The issue is that BK International breached the agreement several times. The PPP/C terminated the contract and requested BK International to vacate the site. The PPP/C Government felt that it was BK International that was liable and should pay the Government instead. We were ready to sue BK for compensation.

It was this APNU regime that quickly rolled over and gave BK International a huge payment. This settlement and many others which this Government has concluded are believed by many to be tainted with rampant corruption. Mr Bulkan took the opportunity to castigate me about GuySuCo’s difficulties. Here again, he is displaying a huge gap in his knowledge of what is happening at GuySuCo, or if he knows, he has chosen to be dishonest on the issue.

I mentioned before that GuySuCo’s problems began when the price of sugar received from the EU fell by 36 per cent in 2010. The PPP/C government was investing in the industry to deal with the new reality. Our plan was working as could be seen in the 2015 production.

Had the PPP/C not been cheated out of Office, Wales would not have been closed and Rose Hall would not be threatened with closure.The industry has huge potentials in value added products. This regime refuses to go in that direction and is closing the industry instead. This is a decision that will haunt this country for generations to come.

Mr Bulkan should be one of the last persons to speak or refer to anyone’s ability to manage. After all, he ran his own business into bankruptcy.His pique with the PPP/C administration was because the government did not accede to their request for a bail out of some G$300 million. The PPP/C government felt it could not use taxpayers’ money in that fashion. He is with the APNU now maybe because they don’t care how taxpayers’ dollars are squandered and used to give the elite huge salaries and allowances. As a gentleman, I expect MrBulkan to own up to his words and not seek to hide from them.

Sincerely,

Donald Ramotar

Former President

 

CCJ vigilant on appointment of Judges, independence of the Judiciary

Dear Editor,

The Caribbean Court of Justice (CCJ) is vigilant as regards the method of the appointment of judges and the independence of the Judiciary in the Region. Last Tuesday, the regional court criticised the system how appellate court judges are appointed in Belize. Although the CCJ judges did not entertain the appeal filed by the Bar Association against the Attorney General of Belize, but expressed displeasure with the present arrangement for the appointment of Justice of Appeal.

At present, under section 94 of the Constitution of Belize Chapter 4, Appellant Court “Judges are appointed by the Governor General acting on advice of the Prime Minister given after consultation with the leader of the Opposition… is for such period as may be specified in the instrument of appointment.”

I should state that since there is no fixed time in the appointment, the judges’ tenure is at the whim and fancy of the Executive. This does not find favour with the CCJ which stated in its judgment that Justices of Appeal should be appointed in a similar position as Supreme Court Judges (first instant judges) with an independent appointing body and tenure until retirement age. The CCJ also recommended that shorter periods of tenure should be offered to appointees over the age of 75.

In Belize, Judges, Magistrates and legal officers are appointed by the Judicial and Legal Services Commission (JLSC). The composition of the JLSC – Chief Justice (Chairman), Solicitor General, President of the Public Service Commission and a representative from the Bar Association. Perhaps I should add that Belize is the only jurisdiction in the Region in which lawyers have a say in the appointment of Judges and legal officers.

The Guyana Government is expected to appoint a new Chancellor who will replace Carl Singh who has been acting as Chancellor for the past 13 years, but his appointment was not confirmed since the Leader of the Opposition did not agree to his confirmation. Ian Chang who acted as Chief Justice for more than 11 years was not confirmed either because there was also no agreement. In fact, Chang went into retirement a year ago without being confirmed and Yonette Cummings-Edwards has been appointed as acting Chief Justice.

Guyana is the only country in the region where there must be an agreement between the President and Leader of the Opposition. This was only changed in 2002. Previously it was merely consultation like other jurisdictions in the Region. It seems as if the Cooperative Republic has to be different from other countries. Guyana is the only country in the Commonwealth where the Judiciary is headed by a Chancellor and not the Chief Justice. In July 1966 when the Court of Appeal of Guyana was established, Forbes Burnham who was Prime Minister and Head of Government was not happy for the then Chief Justice, Sir Joseph “Bonnie” Luckhoo to continue to head the Judiciary. He then appointed Guyanese Sir Kenneth Stoby who was Chief Justice of Barbados to the top job and renaming the position as Chancellor of the Judiciary and President of the Court of Appeal.

However, Judges – except the Chancellor and the Chief Justice – in Guyana are appointed by the Judicial and Legal Services Commission which is headed by the Chancellor.

Sincerely,

Oscar Ramjeet

Has the President just awoken from his slumber?

Dear Editor,

What happened? Did President David Granger suddenly wake up and become Columbus number two, that he and his administration now discover that he “…believed the rates are high and that there should have been certain parking exemptions from the inception…”

Also, he said, “We do feel that the contract is burdensome…” Why only now?

What did he do with the reports from his two Ministers – Finance and Legal Affairs? He received those reports several months ago. Did he read them at all and note their recommendations?

Anyway, I’m positive that those reports and the recommendations were discussed at Cabinet, but they took a gamble, relying on the loyalty of their own supporters, ie, the kit and kin, for them to remain quiet by all means possible with the rest of the population.

Note that the President said, “…pay your taxes and let the city run properly and WE won’t have to resort to these measures…”

Now, where did the ‘WE’ come from, especially if he and his Cabinet were not part of the entire process?

Anyone who believes that Minister Ronald Bulkan signed on for the parking meters to become operational on his own, needs his/her head examined.

How can any Minister sign on to something on behalf of the government without the blessings of the President and his Cabinet? Just like the Drug Bond, which Minister George Norton eventually confessed, was a Cabinet’s decision.

I do congratulate everyone who has and will continue to protest. The effectiveness of those demonstrations are the real reasons for the Government and the Mayor and City Council waking up and trying to cover up their blunders, with the Government mouth-pieces claiming they are now looking into the wellbeing of the citizens of this dear land.

What really jolted them into action is not just the size of the demonstrations, but the unity of all the demonstrators. This is their real headache and President now telling us about the ‘Terror Clause.’

The parking meters have to be scrapped. We have to remain united, for in unity lies strength. This ‘Terror Clause’ has nothing to do with us. As citizens we were never informed or consulted.

Therefore, let those who were involved and signed on to it, let them pay, be it the Government of the ‘Gang of Four’. Those ‘green monsters’ have to go; we are already under too much financial burdens.

Let them go after those who are not paying taxes to raise revenues.

Yours sincerely,

Chandra Shekar Azad

 

Reports of US immigration raids in Queens for illegals

Dear Editor,

Newspapers are reporting that Federal Immigration and Custom Enforcement (ICE) Agents of Homeland Security raided restaurants, stores and other job sites in Elmhurst and other parts of Queens. There are also rumours that ICE agents raided Liberty Avenue, Richmond Hill (dubbed Little Guyana) last week though this has not been confirmed.

The reports from raids in Queens say hundreds were picked up. And it is not clear if any out of status Guyanese immigrants were picked up and in custody and the nature of their violations. Trinis and Jamaicans were arrested. Rumours of the raids swept through the tight Indo-Guyanese and Indo-Trini communities of Queens where tens of thousands of Indian Guyanese and Trinis are settled. Queens is home to tens of thousands of undocumented immigrants from the Caribbean and Latin America, including thousands of Indo-Caribbeans. These immigrants contribute billions of US dollars in productivity; they engage in low level and low paying jobs (like picking fruits and vegetables, staffing restaurants, stacking shelves of groceries or vegetable stands, and factory work) that “regular or native” Americans refuse. The illegals live among their ethnic communities to blend in and avoid attention. Because of their physical appearance and generally thought to be non-Americans, minority communities like Indians, Hispanics and Arabs are targeted for ICE raids.  As community leaders and immigration advocates note, Indo-Caribbeans and South Asians are easily distinguishable from other groups and are often mistaken for Middle Eastern Arabs or Hispanics; their communities are targeted for ICE raids to check on immigration status.

ICE agents have been raiding immigrant communities all across the US since Donald Trump was sworn in as President a month ago. The new President issued an executive order for the arrest and deportation of illegal (undocumented) immigrants. In addition, the President issued a travel ban on immigrants (including those with green cards and visas) from seven Islamic countries. Already the Caribbean immigrant community is on edge in the wake of Trump’s travel ban. The raids, travel ban, detention, and denial of boarding of aircrafts bound for the US have left Guyanese and other immigrant communities worried and confused about Trump’s immigration policy. Elected officials and community leaders say the raids in New York, and particularly so in Richmond Hill, have created tremendous amount of fear among immigrants regardless of status. Officials note that immigrants who committed minor offences including evading transportation fears run the risk of being arrested and their record made available to ICE for pick up and deportation. However, the city’s mayor, Bill de Blasio, said the city will not turn over illegal immigrants to ICE and that anyone arrested or in public schools will not be asked about their status. Community leaders from Richmond Hill were interviewed on NY TV 1 about recent raids. The raids in various parts of Queens were condemned by all community leaders, immigration lawyers and politicians.

Yours truly,

Vishnu Bisram

 

Govt moving ahead with housing project at Perseverance

Junior Communities Minister Valarie Adams-Patterson during a press briefing on Tuesday

Junior Communities Minister Valarie Adams-Patterson during a press briefing on Tuesday

Government’s ‘Housing Solutions for 2017 and Beyond’ initiative is moving full steam ahead and contractors have already been hired to build low-income, moderate-income and middle-income homes at the Perseverance Housing Scheme on the East Bank of Demerara.

The Central Housing and Planning Authority (CH&PA) on Tuesday signed agreements with 14 contractors for the construction of houses which will develop a model village exhibition to be hosted from May 1–5.

The signing of the contracts took place at the Housing Ministry on Brickdam.

Junior Communities Minister with responsibility for housing, Valarie Adams-Patterson explained that the project will have on display life-sized houses for members of the public to view and which will be up for sale after the exhibition.

Interested persons would have to make two payments, one to the CH&PA for the land and another to the contractor for the house.

Purchasers would have to have an application in the authority’s system or would have to meet the criteria to qualify for an allocation.

The Minister explained that the dual payment formula is to guarantee persons in the system are allotted homes.

“That is to ensure, our objective as I said is to reduce the number of applicants that we have in the system and so we cannot afford to have persons who had a previous allocation coming again and being able to purchase that house,” she explained.

Currently, there are approximately 25,000 applicants in the CH&PA system awaiting allocations. Additionally, with the minimum age being changed from 21 years to 18 years, more and more applications are being received on a daily basis.

The low-income land will cost G$300,000, the moderate-income G$500,000 and the middle-income G$700,000.

The contractors will have to construct 10 low-income, five moderate-income, and eight middle-income houses.

Contractors were given an 80×45 feet low-income land to construct a 600 square foot house and an 80 x 62 feet moderate-income land to construct a 900 square foot moderate-income house.

Those contractors opting to construct middle-income houses were given 80×85 feet land to build 1100-square foot houses. The cost of the houses will be determined by the contractors and there will be no policy by the agency to control those prices.

“We’ve had meetings with the exhibitors and we shared our expectations but we cannot control their price. We expect that they will keep it within current market price because they have to sell it and if they price is high, they would not be able to and there is a clause in the agreement that will take care of that,” she explained.

However, the Minister assured that contractors will be penalised for failure to sell off the houses within six months after the closing of the exhibition.

She emphasised that there will be a penalty enforced if the contractors fail to sell the houses within the stipulated six months; however, she could not remember what the nature of the consequences will entail.

Furthermore, the Minister explained that the CH&PA will be constructing six duplexes for the model village and that one developer committed to constructing a townhouse.

She noted that one of the aims is to conduct a survey which will inform the Government of the public’s preferences before it goes ahead to develop duplexes and townhouses across the country.

“If and when the CH&PA decides that we are going to continue to build low-income, moderate-income, middle-income, whatever, we want to understand. Rather than us giving what models we think the Guyanese people want to have, we (would) now understand what they need,” she stated.

Moreover, the Authority conducted diligence background on the developers to ensure that they have the human resource and financial capability to complete the houses. Their agreement stipulates that they must submit weekly progress reports to the authority.

Each contractor has been given a construction milestone that would also guide their construction and has also provided for on-site monitoring.

The contractor is also responsible for any defects to the building during the period up to when the house is sold. They shall be responsible for the maintenance of all drain reserves and parapets.

Also, the purchaser is prohibited from making any modifications or extensions to the building purchased for a period of five years, except with the consent of the CH&PA. The purchaser may make modifications thereafter with the permission of the Eccles/RamsburgNeighbourhood Democratic Council (NDC).

The land and both the house cannot be sold until 10 years after the date of passing of the respective certificate.

The Yankee dollar

As the dispute continues as to whether or not there is actually a shortage of US currency available In Guyana, the Economist ran a very interesting article one week ago that reminds us of the critical role the American currency plays in anchoring the economy of the world, including ours. As the title, “Donald Trump and the dollar standard” suggests, the volatile United States (US) President may also affect the volatility of that standard and consequently the world’s economy.

Directly after World War II, when the World Bank and IMF were founded to coordinate the world economy, the US dollar, which was pegged to the price of gold, became the reserve currency, even as the US had to keep the requisite quantity of gold to “back” its currency. But in 1970, when the US, under pressure, unhitched the dollar from gold, countries increasingly began to keep their reserves in dollars – which are never kept in the banks of the individual countries, but in the US Federal and “correspondent” US banks. This is done as a hedge against volatility swings on the premise that with the US being the dominant economy in the world, it would be least affected by uncertainties.

Presently, almost US$10 trillion of debt is also denominated in dollars – rising exponentially from the US$1 trillion in 1980. The use of the dollar as a reserve currency and to denominate debt gives the US not only great power over the world’s economy, in that its fiscal and monetary policies ripple through almost every other economy, but also it can finance almost any amount of fiscal deficits since the paper it prints and calls “dollars” are automatically accepted for goods and services by the rest of the world. The latter, from this perspective, is financing America’s debts.

The Economist’s article offers a perspective on another topic that has surfaced recently in the ‘foreign currency shortage row’: exchange rate controls. At the time of the establishment of the Breton Woods financial institutions, about 40 per cent of countries had capital controls, but this grew to over 50 per cent by the 1980’s, which is remarkable when one considers that the number of countries had doubled through decolonisation in the same period. But from the 1980’s when the Washington Consensus insisted on liberalisation of financial markets, countries with capital controls plummeted down to about 12 per cent. This was accompanied by the comparable exponential increase of foreign reserves – especially denominated in United States Dollars – held by the “liberalised” economies. But in the last two years, there has been a mirror image increase in countries with exchange controls and decrease in the volume of foreign reserves. Guyana should take notice of this move to stabilise exchange rates via controls, rather than reserves.

The Economist highlighted that in light of Donald Trump’s declaration, his administration intends to “put America first”, especially in returning “production” to US shores. While on one hand some may feel that the US is getting a free ride to import foreign goods with the pieces of paper it prints, this – as we have seen – is not viewed kindly by domestic manufacturers and their work force. They point out that it is not “the US” that is gaining, but the one per cent.

It is feared that if Trump goes ahead with his promise to cut taxes and increase domestic spending massively, this may lead to inflation that would make the US reserves and dollar-denominated foreign debt less attractive and lead to an exodus that can threaten the entire global economy. Alternately, or in tandem, countries may decide to abandon the dollar as their hedge against volatility and impose tariffs and capital controls to perform that function as in the past. In either scenario, small countries like Guyana, which depend of global free trade, could be crushed.

Another more benign scenario could be the role of a reserve currency becoming shared by other currencies such as the Chinese Yuan. China had already declared it is willing to step in.