Guyana will next year table legislation in the National Assembly to create a Sovereign Wealth Fund (SWF), ahead of commercial drilling for oil by American oil giant, Exxon Mobil, Minister of Governance Raphael Trotman announced Wednesday.
Addressing the opening of a workshop on the SWF’s creation at the Arthur Chung Conference Centre (ACCC), he said the Bill would be laid in the House before the end of 2016 for scrutiny and debate as well as inputs from the wider Guyanese public.
“Nationwide consultations will be held both before and during the process of finalizing this policy through necessary legislation,” he said.
The Canada-based University of Calgary, which has a significant expertise in SWFs, is conducting the workshop through the courtesy of the Canadian government.
While much appears to be linked to Exxon-Mobil’s discovery of a huge oil deposit offshore Guyana’s Essequibo region, he said monies accrued also from gold, diamonds, bauxite, sand, stone and water would be deposited in such funds. “Earnings from all of our natural resources will be housed within resource wealth management funds to the benefit of all Guyanese in three key areas,” he added.
They, he said, are savings for future generations, budgetary support in times of economic downturn, infrastructural development such as roads in hinterland communities and schools.
Participants-who are drawn from the Ministry of Finance, Department of Natural Resource and the Environment, Guyana Forestry Commission, Guyana Geology and Mines Commission, Bank of Guyana and the Environmental Protection Agency- will be introduced to existing models, share experiences and prepare Guyana for a “wave of wealth that will not pass again in our lifetimes.”
Other areas to be considered include whether the SWFs should be held in Guyana or overseas, and new fiscal and legal structures that will guide the sustainable exploitation of extractive industries.
Forty-six countries have SWFs that are governed by rules on savings, timing of withdrawals and areas of expenditure.