The South American country of Guyana intends to spend the billions of dollars that is expected from oil production in the coming years, in the context of its Green State Development Strategy (GSDS).
The GSDS will guide Guyana’s economic and sociocultural development over the next 15 years. The objective of the strategy is to reorient and diversify Guyana’s economy, reducing reliance on traditional sectors and opening up new sustainable income and investment opportunities in higher value adding and higher growth sectors.
Finance Minister Winston Jordan said a green paper along with the requisite draft legislation on the Natural Resource Fund – renamed from Sovereign Wealth Fund – will be sent to Cabinet shortly for its examination.
“Shortly we should be going to our Cabinet with a green paper and with a draft of the legislation. Once those are cleared by the Cabinet then we will make them available to the public for further discussions, refinements and improvements, then we will hand it over to the Attorney General Chambers and then to the Parliament,” he said during an interview at his Main Street, Georgetown office on Monday.
He further clarified that, “The issue of what to do with monies that are coming to us is a matter for our Green State Development Strategy,” pointing out that it is in this context, or any structural development plan, that monies coming to the country will be used.
“The Green State Development Strategy is not some strategy outside of what has to be done in Guyana. For us, the Green State Development Strategy is our strategy for what has to be done in Guyana over the medium to long-term,” Mr. Jordan pointed out.
He reminded that the Natural Resource Fund has three broad objectives, “which are; intergenerational equity, price stabilization and the financing of critical and approved activities within the context of the National Budget.”
“And that is where for example we will be drawing from the National Development Strategy activities to get it via the budget. So the issue is to see how those objectives will be met; how is the fund going to be invested where is the fund going to be kept what is the accounting arrangement and transparency arrangement and so forth. I think that is what essentially should be the discussion over the Sovereign Wealth Fund,” the Finance Minister added.
The Commonwealth Secretariat has been instrumental in assisting Guyana in drafting the laws and establishing the necessary institutions and fiscal rules for the Natural Resource Fund, previously referred to as the Sovereign Wealth Fund. The draft bill was also scrutinized by the International Monetary Fund (IMF), the World Bank and Inter-American Development Bank.