During 2001, the Chairman said, the Institute continued to play an important role in the development of the micro and small business sectors with loans to the agricultural sector amounting to $259.7M and $212.6M to commercial activities.

The Chairman also said that IPED contributed $10.5M to manufacturing; $21M to fishing; $10.5M to mechanical/engineering workshops and related activities; and $4.9M to agro-processing.

The sum of net profits generated and wages paid out by IPED loan beneficiaries was $4.6 Billion, Persaud said while delivering the Chairman's Report at IPED's 16th Annual General Meeting (AGM) which was held yesterday at Le Meridien Pegasus Hotel, Kingston, Georgetown.

Persaud said the business environment was adversely affected by the turmoil and political protests and marches in the aftermath of the 2001 general elections. According to him, political and economic stability are absolutely necessary to create the confidence needed to attract and retain local and foreign investments to propel the economy forward and to create jobs and wealth for the people of Guyana.
A section of the gathering yesterday at the 16th AGM of IPED. Seated in front row (from left) are the Russian Ambassador, the British High Commissioner, the Canadian High Commissioner and United States Ambassador.
A section of the gathering yesterday at the 16th AGM of IPED. Seated in front row (from left) are the Russian Ambassador, the British High Commissioner, the Canadian High Commissioner and United States Ambassador.
He noted that since its inception, IPED has been able to train and fund thousands of small and micro entrepreneurs, many of whom "were able to transform their lives from the poorest of the poor to become self-reliant members of society".

The Chairman admitted to those gathered at the AGM that it is gratifying to report that 75 to 80 percent of the micro entrepreneurs are women, many of whom are single mothers, who are now able to maintain and sustain a reasonable standard of living.

The Institute made a surplus of $47M in 2001 against a surplus of $90M in the preceding year and Persaud said the main reason for the decline was the need to substantially increase the provision for doubtful debts, because of the slowdown of economic activities.

The IPED Chairman said, too, the provision for bad debts has been increased from seven percent to 18 percent of total debts and the intention is to increase it to 25 percent within the next two years.

Regarding IPED's staff, Persaud said: "The staff continues to perform creditably and is committed to greater efforts in the year 2002 and beyond. The staff is also conscious that they have to be extra conscientious and innovative in the present financial environment."

"We hope the economy improves in the future since IPED depends on the greater economy to move forward in full gear so as to provide the market for the micro and small entrepreneurs," he added.

President Bharrat Jagdeo, as he did last year at the IPED's 15th AGM, which was held at the same venue, complimented the Institute for its admirable contribution to the development of the small and micro business sector in Guyana.

Mr. Jagdeo, in his address yesterday, told the gathering, which included several members of the Diplomatic Corps, that micro enterprises would only be vibrant and sustainable “if we look at it in the context of the wider economy, taking into consideration the external environment, the taxation system and political stability”.

"I can promise that we would work at improving the environment for micro enterprise development. We've had some help from USAID and we have a number of consultations going on right now where we are examining various models, and we hope that early next year, the Small Enterprise Development Bill will be tabled in the National Assembly to give that framework that we are thinking about...," the President said.

The President also urged the management of IPED to possibly lower its interest rate on loans to keep up with the downward movement in interest rates in the larger commercial banking sector.

"I have seen that downward movement in the larger commercial banking sector, where some people are negotiating loans (in Guyana dollars) for as low as 12 and 14 per cent (interest). Now IPED needs to review its interest rate structure and I am sure that I will receive your support on this...this had to happen because at one time I heard that IPED needs to be inline with the market and the market has come down significantly," President Jagdeo stated.

The President also noted that IPED is working on a personalised basis to assist small businesses, which have encountered difficulties.

"IPED can always count on the Government for support because you've done a good job. You are providing a very important service and it’s not just the money. It is also the after-loan services, which are very, very important," he added.

"We've always thought and we still think that micro-enterprise has a role to play in any economy, especially one like ours," Mr. Jagdeo pointed out.

According to him, micro-enterprises are important, not simply because they create wealth, employment or linkages within an economy, but because micro-enterprises "incubate entrepreneurs" and that's critical for a country like Guyana.

"I listened to Mr. Persaud, when he said that spending is very important to any economy and I endorsed that. But economies like ours are very different in structure from that of the United States of America or countries of Europe in that we would never be able to have a dynamic economy based only on local spending," President Jagdeo said.

According to him, local spending cannot be driven by local demands because local demands are just too small, and in this regard, “we have to rely heavily on world demands”.

Mr. Jagdeo said what has almost become a `mantra' is the fact that "every single day you hear people talk about WTO (World Trade Organisation) and FTAA (Free Trade Area of the Americas) and the (CARICOM) Single Market and Economy and the new ACP/EU (African Caribbean and Pacific- European Union) negotiations. And (it seems) that these are things that don't matter to them."

"...but it matters. It matters very much because whatever is agreed in these different negotiations will have an impact on what you can produce and whether you can produce it sustainably," Mr. Jagdeo pointed out.