Guyana - Foreign investment

Investment by foreign firms accounted for the bulk of capital formation prior to the establishment of Guyana's cooperative republic in 1970. After Guyana became a cooperative republic, the government did little to attract foreign private investment. The Hoyte government, however, began efforts to obtain foreign investments for the rehabilitation of the bauxite industry and for oil prospecting and gold mining. New legislation to simplify foreign investment procedures was written in 1987.

The implementation of the Economic Recovery Program and the strong interest of the government in privatization attracted many foreign investors. In 1988, the government permitted foreign ownership of businesses operating in Guyana. In addition, the government is prepared to implement arrangements designed to facilitate investors' derivation of tax benefits in their home territories as well as tax credits in Guyana. Other investment incentives include: tax holidays, export allowances, accelerated depreciation, an Export Processing Zone, and special provisions for agribusiness, mining, and tourism.

From 1997 to 2001, annual foreign direct investment (FDI) inflows to Guyana averaged $54 million, with a high of $67 million reached in 2000. For the period 1998 to 2000, Guyana's share of world FDI inflows was 2.2 times its share in world GDP. This was a marked improvement over the period 1988 to 1990 when Guyana's share of world inward FDI flows had been only 70% of its share in world GDP.

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