UN report shows slowing in foreign investment flows to Guyana
The United Nations World Investment Report published last week indicates that foreign investment flows to Guyana have slowed considerably since a high in 1994. The report shows that direct foreign investment in Guyana reached US$107 million in 1994 and $94 million in 1996 but had since reduced with only $53 million in 1997, $49 million in 1998 and $48 million in 1999. Dr Maurice Odle, adviser to the Caribbean Community Secretary- General, told reporters at the launching of the report at United Nations House last Tuesday, that foreign investment was essential to Guyana's economic growth. He noted that since savings rates were so low, internally-generated funds for investment were scarce. The report published by the United Nations Conference on Trade and Development (UNCTAD) looks at the effects of mergers and acquisitions on the growth of developing nations. The acquisition of small companies by large transnational corporations has increasingly become the engine of growth for emerging economies as they look to divest inefficient state industries. The report contrasted acquisitions as against green field investments, noting that while green field or "start from scratch" investments engendered new employment in the short term, acquisitions could, if they entailed retooling and expansion, create equal employment in the long run.
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