FOOLS GOLD AT THE LENDING WINDOW

THE 592 GUARDIAN

Accountability. Without Apology.

EDITORIAL | JUNE 2026

FOOL’S GOLD AT THE LENDING WINDOW

The PPP’s ‘Development Bank’ Is Not a Lifeline for Small Business — It Is a Slush Fund with a Press Release

Floyd Haynes, Chairman of Newhaven Merchant Bank, concluded his recent op-ed on the proposed SME Development Bank with a quiet prayer dressed up as policy analysis: “If we get this right…”

If.

That single syllable, tucked into the closing paragraph of an otherwise enthusiastic endorsement, contains more honesty than anything else in the piece. Because the question Haynes cannot bring himself to answer — and the question every Guyanese citizen should be demanding an answer to — is this: When, precisely, have we ever gotten this right?

Not once. Not in any institution of consequence built by this administration or its predecessors under this governing arrangement. Not in the road contracts that ballooned and stalled. Not in the housing schemes that became patronage lotteries. Not in the public procurement processes that enriched the well-connected while the public waited. Not in the regional administrations where accountability travels in one direction — upward, to party headquarters — and never back to the people.

The record is not ambiguous. It is not contested. It is carved into the landscape of every region in this country in the form of unfinished projects, overpriced contracts, and quietly shelved reports. And yet, here we are again — presented with a US$200 million institution and asked to believe that this time will be different.

“If we get this right” — Mr. Haynes, that conditional is not a caveat. It is a confession.

THE ARCHITECTURE OF THE FAMILIAR

Strip away the language of inclusion — the seamstress in Sophia, the agro-processor in Berbice, the wheelchair-using developer in Linden, all of them deployed as rhetorical furniture to make a political instrument sound like social policy — and what you have is a lending institution that will be capitalised with public money, governed under political oversight, and staffed, at the decision-making level, by individuals whose primary qualification will not be credit analysis or development economics.

It will be loyalty.

That is not cynicism. That is the operational pattern of every quasi-public institution this government has touched. The question of who makes the final lending decisions is not addressed anywhere in the Haynes piece, nor in any of the administration’s announcements. There is talk of governance frameworks, transparency pillars, and independent credit assessment. There is no talk of who appoints the board. There is no talk of what protections exist against ministerial interference in individual loan decisions. There is no talk of what happens when a party financier’s cousin applies for GY$3 million to start a business he has no intention of running.

These omissions are not oversights. They are the design.

ZERO INTEREST, ZERO ACCOUNTABILITY

Mr. Haynes is correct that commercial lending rates of 10 to 14 per cent are prohibitive for micro-enterprises. He is correct that collateral requirements exclude women, young people, and persons with disabilities at disproportionate rates. These are real structural failures of the Guyanese financial system, and they deserve a real structural response.

But a zero-interest loan pool administered by a politically appointed institution, without enforceable arm’s-length governance, is not a structural response. It is a structural opportunity — for the party, not the public.

Zero interest and reduced collateral are not just pro-small-business features. They are also the precise combination of conditions that make a lending institution maximally attractive as a vehicle for politically directed disbursement. The lower the barrier to lending, the wider the discretion available to those controlling the tap. The less collateral required, the less documentation needed to justify a decision. The more that decisions can be framed as serving the bank’s social mandate, the harder it becomes to challenge any individual disbursement.

This is the cobra effect Mr. Haynes references — but he applies it narrowly, to borrowers who might default. He does not apply it to the institution itself, which faces every incentive to lend politically and no enforceable constraint to prevent it.

The lower the barrier to lending, the wider the discretion available to those controlling the tap.

APPEASEMENT INFRASTRUCTURE

Let us be direct about what this bank is in the context of Guyanese political economy.

The PPP has, over the course of this oil boom, constructed a vast machinery of resource distribution. Contracts, jobs, housing allocations, scholarships, cash grants — each instrument serves a dual function: a stated public purpose and an unstated political one. The stated purpose is what gets written into op-eds and ministerial speeches. The unstated purpose is what keeps the base mobilized, keeps the loyalists rewarded, and keeps the opposition constituencies just comfortable enough not to organize.

A development bank with GY$3 million zero-interest loans is not a departure from this machinery. It is the most sophisticated addition to it yet. It is targeted at demographics — youth, women, small business owners — whose support is politically valuable and whose economic precarity makes them susceptible to cultivation. It offers enough real benefit to the base that the political dividend is genuine, while the institutional structure ensures that the discretionary benefits flow to those who matter.

This is not a conspiracy theory. This is how patronage democracies function. They do not distribute nothing — they distribute selectively, visibly, and with just enough reach to sustain the narrative that the party governs for everyone. The seamstress in Sophia gets her loan. The party agent gets ten.

THE UNTOUCHABLE CLASS

There is a deeper structural point that the Haynes analysis — earnest though it may be — entirely misses. The establishment of this bank is not simply a policy decision. It is another layer of the oligarchic architecture that this administration has been building, methodically and with considerable sophistication, since it returned to power.

That architecture operates on a simple principle: enough money and enough loyalists, deployed across enough institutions, creates a class that is untouchable regardless of electoral outcomes. When the contracts are awarded to your allies, the boards are populated by your supporters, the lending decisions are made by your appointees, and the beneficiary lists contain enough ordinary names to create plausible deniability — you are not merely governing. You are constructing a permanent infrastructure of advantage that survives government.

In or out of power, the class that controls these flows is the untouchable class. The development bank, far from being a challenge to that structure, is one of its most elegant expressions. It takes the credibility of financial inclusion — a cause with genuine moral weight — and uses it to launder the distribution of resources to the network.

Mr. Haynes calls for vigilance. We agree. But vigilance directed at the borrowers — will they default, will they use the money wisely — is precisely the misdirection the architects of this institution are counting on. The vigilance that matters is directed at the lenders: Who appointed them? Who do they answer to? When a politically connected applicant’s file moves to the top of the queue, who pushes back, and at what personal cost?

WHAT DUE DILIGENCE ACTUALLY REQUIRES

The 592 Guardian does not oppose access to credit for small Guyanese businesses. We have consistently argued that the formal financial sector’s exclusion of women, youth, and rural entrepreneurs is one of the most consequential structural failures in this economy. The principle behind this bank is not wrong. The problem is that principles do not govern institutions — people do, and the people who will govern this institution have not been named, have not been subjected to any public vetting, and have not been required to operate under any governance framework that exists independently of the executive branch.

Before a single loan is disbursed, the public is owed answers to the following:

Who appoints the board, and can the President or Cabinet remove a board member without parliamentary approval? What is the explicit prohibition on current or former party officers serving in decision-making roles? What is the independent complaints and appeals mechanism for rejected applicants who believe political criteria influenced their outcome? What are the quarterly public reporting obligations, and who has the legal standing to enforce them? Who conducts the external audit, and does that auditor report to Parliament rather than the Ministry?

None of these questions are addressed in the government’s announcements. None are addressed in the Haynes piece. Their absence is not incidental.

GETTING IT RIGHT HAS NEVER BEEN THE PLAN

Mr. Haynes writes that “if we get this right, a decade from now we will look back on the establishment of this bank as the moment Guyana decided that prosperity would be built from the bottom up.”

It is a stirring vision. It also assumes that getting it right is the objective.

The record of this administration — on public procurement, on oil revenue governance, on the management of state enterprises, on the awarding of infrastructure contracts, on the population of every board and commission of consequence — suggests that getting it right, in the sense Mr. Haynes means, has never been the primary objective. The primary objective has been getting it done in a way that consolidates power, rewards loyalty, and constructs durable institutional advantage for the ruling class.

A development bank, given that objective, is not a vehicle for financial inclusion. It is a vehicle for financial control. The inclusion is the cover. The control is the point.