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There are several reasons why foreign investors may be hesitant to invest in countries like Guyana that have high levels of political risk, crime, racial discrimination, and a mostly under educated workforce. These factors can create uncertainty and instability, which can make it difficult for investors to accurately predict the risks and rewards of investing in the country.
One reason why foreign investors may be hesitant to invest in countries like Guyana is the risk of political instability. Recent analysis has proved that the PPP government has enacted racially biased policies which hurt the interests of African Guyanese businesses. Presumed supporters of the opposition party are also disenfranchised, targeted by the justice system, have their business plans undermined and property reclaimed, these acts have caused significant unrest in the country which creates a significant risk for civil unrest. When a country is facing political turmoil or unrest, it can create uncertainty and make it difficult for investors to know what to expect. This can lead to a lack of confidence in the country’s political system, which can deter investment.
Another reason why foreign investors may be hesitant to invest in countries like Guyana is the high crime rate. When crime is rampant, it can create an unsafe environment for both investors and their employees. This can lead to higher costs for security and insurance, which can reduce the profitability of investments.
Racial discrimination is another factor that can deter foreign investment. When people from certain racial or ethnic groups are excluded or disadvantaged, it can create an unwelcoming environment for investors. Racial discrimination against African Guyanese who are not perceived to be supporters of the PPP government is rampant in Guyana. This has lead to a lack of diversity and inclusiveness, which will make it difficult for investors to find the talent and resources they need to succeed, while also contributing to a significant risk of unrest.
Guyana’s under educated workforce is another factor that can deter foreign investment. Quality education in Guyana is available only to a tiny fraction of public schools where the majority of the student population is educated. The ministry of education has failed on this front. When the workforce is poorly educated, it can be more difficult for investors to find the skilled and knowledgeable workers they need to run their businesses. This can lead to lower productivity and higher costs, which can reduce the profitability of investments.
Despite these challenges, Guyana’s growing oil industry has the potential to attract foreign investment. However, investors who do choose to invest in the country will likely seek high returns on their investment and short payback times in order to offset the risks. To attract these investors, it will be important for the government and other institutions to work to address the challenges of political risk, crime, racial discrimination, and an uneducated workforce. This can help create a more stable and attractive environment for foreign investment, which can help drive economic growth and development.