Opposition, Bank of Guyana nominees to oil fund’s Investment Committee approved months later

Last Updated on Wednesday, 19 June 2024, 18:16 by Writer

The nominees by the Opposition Leader and the Bank of Guyana on the Investment Committee of the Natural Resources Fund into which oil revenues are deposited have been approved retroactively and could now sit on that decision-making body, according to the Official Gazette.

The Opposition Leader’s nominee, city businessman Dr Terrence Campbell and Mr Ganesh Sugrim were nominated by the Governor of the Bank of Guyana, according to an amended Cabinet decision dated May 23, 2024. Dr Campbell’s appointment is effective from November 1, 2023 and Mr Sugrim’s dates back to March 1, 2024.

However, Dr Campbell, said the opposition should have also had a representative on the NRF’s Board of Directors and the Public Accountability and Oversight Committee (PAOC). “This Board is assisted in its work by a Public Accountability and Oversight Committee, and an Investment Committee. The Opposition has no representative on the Board or the PAOC. Surely such appointments would have aided robust policy discussions and transparency,” he told Demerara Waves Online News.

Dr Campbell also registered his reservations about the constitution of the Investment Committee, saying that it was unlikely to properly fulfill its role with the current rate of depletion of the Fund. Despite his concerns, Mr Campbell welcomed the opportunity to be part of the NRF process. “I look forward to serving the people of Guyana and bringing an independent perspective to the deliberations of the Investment Committee,” he said.

The NRF Act was amended earlier this year to allow for withdrawals from the first US$5 billion of deposits paid into the Fund in the preceding fiscal year. After the first US$5 billion, 90 percent of deposits in the fiscal year immediately before will be saved for future generations. 

The Investment Committee advises the Board of Directors on the Investment Mandate by taking into account the objectives of the Fund, current conditions, opportunities and constraints in relevant financial market, ensure sufficient funds are available for withdrawals, international best practices in investment portfolio management, financial diversification with the objective of maximising risk-adjusted financial returns and taking into account the capacity of the institutions involved in the management of the Fund and Guyana’s ability to bear financial risk.

The law provides for the advice of the Investment Committee to be contained in written reports submitted to the Board of Directors at least annually or within twenty working days of the Board of Directors requesting such advice. According to the law, the Investment Committee shall within 30 working days of the end of every fiscal year submit a report on its activities to the Board of Directors.