Diversifying Guyana’s economy

In the process of diversifying its economy, Guyana is, inter alia, investing in the harnessing of their rich natural resource base and agricultural potential.  Two principles that should inform such investments are the maximisation of value added opportunities both in the natural resources and agriculture sectors and particularly in the latter, to the “endogenisation” of the supply chain so that the final product has the maximum local input possible.

Under the natural resources umbrella, the mining and forestry sectors are key areas to be targeted. In the mining sector, we produce gold, bauxite and manganese but we export the raw material for it to be processed overseas.

Now however, that Guyana is in the process of installing facilities to provide the country with an affordable and reliable energy supply, we are in a position to consider carrying out the processing locally. For gold, this would involve the construction and operation of a local gold refinery and the cessation of the export of raw gold. Refining gold domestically allows Guyana to capture the added value from processing, leading to higher earnings compared to exporting raw gold. Guyana should also think of promoting its unique jewellery designs – the Timehri inspired designs and our traditional “filigree” patterns – as a distinct Guyanese product for the international market.

For bauxite we now have the opportunity to produce alumina locally and to consider our own smelter to produce aluminum. This development could lead to the establishment of a vertically integrated aluminum industry, adding significant value to Guyana’s bauxite resources. Manganese ore can be processed locally into higher value products such as ferromanganese or electrolytic manganese dioxide, which are essential for inputs in steel manufacturing and battery production respectively.

Under the mineral resources umbrella, we should not ignore our vast deposits of high purity silica sand. I have often remarked that our silica deposits are a “gold mine.” They can form the basis of a local glass industry, this time around for a glass container (and not sheet glass as in our former investment) manufacturing facility. This could provide containers for our regional beverage and food industries. As we move away from plastic, we would be well placed  to fill the breach with glass containers. Our silica has also proven to be of crystal glass quality, and highly suitable raw material for the production of high quality crystal glassware. It is also ideal material for the production of pure silica for the manufacture of optical fibre and photovoltaic cells for the solar energy industry. Its present use in the construction industry and for beach replenishment in countries we export to, is not the best  use of our silica deposits, as a recent UNEP report confirms that silica is now becoming a scarce commodity in the global market.

Under the mineral resources umbrella, we should not ignore our vast deposits of high purity silica sand. I have often remarked that our silica deposits are a “gold mine.”

In the forestry sector, emphasis should be on the production of  furniture, building materials for home construction etc. and decreasing our export of logs. As far as possible we should seek avenues for local and export markets for wooden goods. The use of non-wood forest products for furniture (Liana Cane) and ornaments should be further promoted. The Institute of Applied Science and Technology (IAST) had done extensive work on balata, resulting in the development of methods to produce goods made from rubber. This was based on work which determined that balata and rubber were chemically the same except for one physical property. The Institute had successfully manufactured rubber gloves, rubber tiles and rubberised paint (used in painting road signs) from balata and had obtained a patent on these. Work on kokerite palm oil, which was sent to Brazil for assessment, showed that it was an excellent raw material for manufacturing biodiesel. Interestingly, years after that assessment Brazil is now manufacturing and utilising a biodiesel derived from a native palm from the Amazon. Maybe Guyana should follow up on examining the potential of producing biodiesel from kokerite palm oil.

Across the forest industry, some consideration should be given to the use of sawmilling wastes for energy generation. Decades ago, the IAST converted the diesel generator facility at sawmill at Willems Establishment on Kaow Island to use the wood waste to provide for all of  the community’s energy requirements. The waste to energy approach has two advantages. It provides the user with a ready and cheaper source of energy for their operations and it relieves the environmental challenge of waste management. For the rice industry, rice husks can be used to power the rice processing facilities (the IAST converted two of Kayman Sankar’s rice mills in Essequibo and Berbice). The residue left from the incineration of the husks, Rice Husk Ash (RHA), turns out to be a highly valued commodity. Work at IAST and the Faculty of Technology at the University of Guyana confirmed that RHA can be used as a supplementary cementitious material in concrete production. Its pozzolanic properties enhance the strength and durability of concrete while reducing the overall cement requirement, leading to cost savings and environmental benefits. There is now a very high demand for RHA globally; in 2023 the market was valued at approximately USD $2.6 billion and is projected to reach USD $3.2 billion by 2028!!

The Demerara Distilleries Company is now in the process of establishing a major dairy farm in Guyana. The facility will generate an enormous amount of animal waste which could pose some challenging environmental problems for its disposal. Designing the facility so that the wastes could be utilised to produce biogas, which could be used as fuel to generate electricity for the operations at the facility, would redound to the benefit of the company and help to address the environmental issue. Further, the slurry remaining in the digester is a highly nutritious organic fertiliser that would have a ready market in the agriculture sector, especially for those targeting the emerging global market for organic produce. With the expected expansion of Guyana’s agriculture sector, attention should be paid to the possible productive use of the different waste streams that are generated.

Finally, let us turn our attention to the issue of endogenisation of supply chains. To illustrate this I will choose our favourite dish of curry chicken. As far as possible for both commodities, we need to see to what extent the inputs into its production are local. For the chicken industry we should in the first instance develop the capacity to have local production of  parent stock (broilers and layers) with high quality local or hybrid breeds suited for local conditions (I recall in my boyhood days two dominant breeds were the red Rhode Island and the speckled Plymouth Rock breeds), as well as hatcheries and locally sourced hatching eggs. Next  is the feed, and it is encouraging to see that the government is already taking steps to address this. We can produce inputs such as corn, sorghum, cassava (energy source), soybean meal, fish meal (protein source), rice bran (fiber and energy) and produce a feed with a maximum input of local produce. Other inputs – minerals and vitamins – will be required and can be imported but every effort should be made to replace these with local substitutes over time.