– A Plethora of Opportunities for all Guyanese (Part 1)
Many countries in the developed and developing world, given their economic importance, are putting local content policies and legislation in place, to limit the ability and power of foreign companies, especially foreign governments, to control their key natural resources sectors.
In February 2021, the Government of Guyana drafted a coherent local content policy with an overarching goal to ‘maximise the level, quality, and benefits of participation in the petroleum sector value chain by Guyanese’[1]. Act No. 18 of 2021, The Local Content Act (LCA), was subsequently passed by Parliament to implement the policy objectives.
The Local Content Act lays down the framework and mechanism that prioritise Guyanese nationals and Guyanese Companies “in the procurement of goods and services for the enhancement of the value chain of the petroleum sector. It seeks to enable local capacity development and to ensure participation in local content in Guyana.”[2]
Further, the Act establishes the criteria for being considered a domestic company. The act sets out the benefits and obligations for foreign investors and local actors aiming to engage in the petroleum industry. There is a requirement for all foreign actors, including subcontractors, licensees or contractors, to ensure local content measures are implemented as an integral part of their operation. This provision essentially provides for the participation of Guyanese citizens in the operation of any foreign investor’s engagement in the Guyanese petroleum industry.
[1] Ministry of Natural Resources, https://nre.gov.gy/wp-content/uploads/2021/02/LCP-for-the-Development-of-Guyanas-Petroleum-Economy-Revised-Draft-02.11.2021-updated.pdf
[2] Ibid An Act
