Guyana’s Finance Minister, Winston Jordan says at a time when the South American country is set to benefit immensely from oil production revenue and the associated business opportunities the industry brings, ‘no reasonable int’l business would want to stay out’, referring to the recent announcement of Scotiabank’s planned exit from the country.
On Tuesday, November 27, Republic Financial Holdings Limited announced plans to acquire Scotiabank’s Banking Operations in Guyana, Anguilla, Antigua, Dominica, Grenada, St. Kitts & Nevis, St. Lucia, St. Maarten and St. Vincent & the Grenadines.
In learning of this development, Mr Jordan, during an interview at his Main Street, Georgetown office on Wednesday, said he is concerned that Scotiabank is pulling out at a time when Guyana is about to emerge as a major oil and gas producer.
But, nevertheless, he said, “In every challenge come opportunities also. This is an opportunity for the indigenous banks in Guyana – Citizens’ Bank, Demerara Bank and Guyana Bank for Trade and Industry to play a greater role, especially with the coming of the oil and gas industry.”
He added that this challenge also presents an opportunity for ‘new entrants’ into the market.
Mr Jordan said, “With what Guyana is expected to earn and achieve over the next one or two decades and down into the future, it is impossible that any reasonable international business would want to stay out. You just have to look at, for example, American Airlines.”
When asked about learning from this experience and safeguarding local interest going forward, the Finance Minister said, “Such measures have to start with the legislation. The soundness, tightness, and oversight of the legislation, because you can have the best legislation, but if you don’t have the proper implementation then there will be some of these very issues existing in the society.
Last July, several amendments to the Financial Institutions Act which strengthens the authority of the Bank of Guyana, was passed in the National Assembly.
“This has given the Governor of the Bank of Guyana wider scope and to make it clear in instances of mergers and crisis that may develop and so we have the legislation in place and we are putting supervision in place to make certain we have the right people in place to police the legislation to ensure the soundness of the banking system,” Mr. Jordan explained.
Meanwhile, the Government of Guyana said it was never informed, prior to the announcement, of Republic Bank’s takeover of Scotiabank’s banking operations.