The Bank of Guyana (BoG), which is the central banking institution of the new oil producing nation, is undertaking several initiatives geared towards creating and maintaining a favourable and stable fiscal environment. This is being developed, particularly to cater to the developing oil and gas sector, which will see billions of US dollars being injected into the country’s economy in the coming years.
Among the efforts being taken are the review of the laws governing the Bank and the creation of policies to foster a more enabling business environment.
On Tuesday, December 1, Governor of the Bank of Guyana Dr. Gobind Ganga, in a presentation at the inaugural Guyana Oil and Gas Summit, encouraged foreign investors to tap into the opportunities that are arising in Guyana, pledging the bank’s commitment to ensuring that the investment environment remains favorable.
“Investment opportunities in Guyana are vast and the Bank of Guyana as the premier financial institution has been working assiduously to ensure that Guyana’s economy remains strong, encourages investment and is willing and able to support the oil and gas sector within Government’s broader mandate,” he stated.
The Bank of Guyana’s primary purpose is the formulation and implementation of monetary policy to achieve and maintain price stability, while fostering a sound, progressive and effective financial system. It functions as an advisor to the Government on economic management, the efficacy of alternative policy instruments as well as the body that monitors the functioning of the financial system and fosters its development.
According to Dr. Ganga, the oil and gas sector will be key for economic growth and will underpin the transformation of Guyana to a modern society. He projected that the country’s financial sector will grow overtime, both in size and sophistication to meet the needs of the sector.
“Bank of Guyana continues to ensure that the risk in the financial sector are adequately mitigated and there’s an even playing field while at the same time encouraging creative products and sophistication,” he stated. “With this affirmation, all of the Central Bank activities are geared to ensure that there is a stable economy and friendly investment climate which will promote growth and prosperity in all sectors of Guyana.”
It was on this note that he highlighted the steps the Bank has been taking to initiate a number of reforms in recent years. “In 2016, we had an FSAP programme that is a Financial Sector Assessment Programme which was conducted jointly by the World Bank and the IMF. And we have adopted all the recommendations thereby reducing the risks in the financial sector,” he pointed out.
Further, he added, “The Bank of Guyana is reviewing both the Bank of Guyana Act and the Financial Institution Act to ensure that they remain relevant and provide the required oversight of the financial system.”
Emphasising that the Bank of Guyana is highly independent and pointing to its role in regulating the financial system, the Governor said the banking system remains sound. Additionally, he said that there is free flow of foreign currency as there is no restriction of foreign currency transactions. “Further, we have liberalised capital accounts where investors are free to repatriate profits at their will,” he highlighted.
He said the Bank of Guyana continues to look at measures to ensure that the Guyana dollar remains stable and there is adequate foreign currency in the system to meet financial needs.