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CARICOM to decide level, duration of local content

Last Updated on Wednesday, 2 March 2022, 22:15 by Denis Chabrol

President Irfaan Ali assented to the Local Content and Natural Resource Fund legislation. (file picture)

In the wake of concerns by the Caribbean Private Sector Organisation (CPSO) about whether Guyana’s local content legislation is breaching Caribbean Community (CARICOM) single market rules, regional leaders have agreed to consider what should the amount of local content and over what period, Barbados Prime Minister Mia Mottley said Wednesday.

Briefing the media on the outcome of the CARICOM mid-term summit that was held on March 1 and 2 in Belize, she said CARICOM leaders have decided to establish an “open-ended” committee  of member states would be discussing required local content for new industries without breaching the Revised Treaty of Chaguaramas that governs the Single Market. “I certainly support that there is a case for some level of local content and the issue will be what should that percentage of local content be and what is the timeline that it should be valid for because if you are giving it to a sunrise industry then they don’t need it thirty years from now,” said Ms. Mottley who is responsible for the CARICOM Single Market and Economy in the regional quasi-Cabinet.

She said after the discussions have been completed, a recommended framework would be dispatched to the full CARICOM Summit to ensure that “no one would be held in breach for wanting to do that which is most natural that if we expect that we share the burden in hard times, then we must share the bounty in good times too.” The Barbadian leader stated specifically that what “we understand Guyana and other countries that want to introduce local content are seeking to do.”

Suriname, where similarly large amounts of crude oil have been discovered, is also touting the need for local content.

Back in mid January, the CPSO President, Gervase Warner had stated that an executive meeting had “agreed that the legislation appears to violate several provisions of the Revised Treaty of Chaguaramas.”  Mr. Warner, who is also the President and Group Chief Executive Officer of the Trinidad-headquartered Massy, had said the CPSO would be raising its concerns first with the Guyana government and then “ultimately to the Caribbean Community.”

During debate on the Local Content legislation last December, Guyana’s opposition A Partnership for National Unity+Alliance For Change (APNU+AFC) had cautioned against the apparent breach of the Treaty of Chaguaramas. But Attorney General Anil Nandlall had only stated, in response, that government had been prepared to deal with that if it had arisen.

Since then, the Guyana government has been repeatedly stating that the Local Content Act does not seek to exclude anyone from working in the oil and gas sector,

Trinidad and Tobago, which has more than 100 years of experience in the oil and gas sector, has a local content policy.