Early poll likely after parliament prorogued

| Nov. 20, 2014 | Georgetown, Guyana

Published by Economist Intelligence Unit

On November 10th the president, Donald Ramotar, prorogued the country's parliament, meaning that it is suspended but not dissolved. Although rare, the move is constitutional. Mr Ramotar made the decision, as he faced a no-confidence vote by the opposition, which holds a small majority in parliament. He expressed his hope that the "time-out" would allow democracy a chance to breathe and said that he wanted to talk with the opposition. However, this appears unlikely. The opposition's leadership is calling Mr Ramotar a dictator. A snap election is therefore likely within the coming months.

Mr Ramotar, whose People's Progressive Party/Civic (PPP/C) heads the country's first ever minority government, has proven less popular than his predecessor, Bharrat Jagdeo (1999-2011), and, owing to the small opposition majority in the country's 65-member National Assembly, has failed to implement any major policies since coming to power. Adding to the Ramotar administration's problems are a string of scandals, some a hangover from his predecessor.

Guyana's politics is delineated by ethnicity. The country was ruled for just under three decades by the descendants of African slaves, grouped under the People's National Congress (PNC). In 1992 descendants of indentured Indian servants came to power as the PPC/C. The PNC continues to be the main opposition party, although it has coalesced with a number of smaller political groups under the banner of A Partnership for National Unity (APNU). The Alliance for Change (AFC) was formed in 2005 with the aim of bridging the ethnic divide, and has had some success in doing so, taking votes from the PPP/C in the 2011 parliamentary election.

Elections expected soon

Had parliament been dissolved—rather than prorogued—elections would need to be held within three months under the constitution. Under Article 70 of the constitution, however, a prorogation can last for six months. The president cannot pass any bills during that period. However, a budget must be agreed by April 30th 2015. The opposition has said that it would vote against the budget and, as a result, Mr Ramotar is likely to have to call elections within three months—a year earlier than they would otherwise be scheduled.

The suspension of parliament is a sure sign that the crisis of governance has worsened significantly since 2011 when Mr Ramotar was elected president. He is unpopular, even among some of those of Indian descent in Georgetown, the country's capital. However, the interior is different. Indo-Guyanese voters more insulated from political scandal, which is centred in Georgetown, are likely to support the PPP/C, regardless of who heads it. The president is confident of winning any upcoming elections.

The vote of no confidence was called by Moses Nagamootoo of the AFC. It is backed by the larger APNU coalition, whose leader, David Granger, last week led a 2,000-strong rally at which he openly labelled Mr Ramotar a dictator. The rally was one of the first that featured voices from both the APNU and AFC on one platform, although the AFC's leadership—including Mr Nagamootoo—was not present. Mr Ramotar insists that he has no decree powers.

Instability will persist

Guyana has suffered political violence in the past. So far protests have been calm and peaceful. However, with tensions high, it would not take much to trigger more violent demonstrations, especially if the opposition APNU and AFC parties were to coalesce and organise bigger rallies. Although political and ethnic violence is now relatively rare, sporadic outbreaks still occur, particularly during elections. There is a relatively high possibility that this could be the case during a snap election.

Political instability, which looks set to worsen, could act as a damper on foreign investment. The country has a nascent oil and gas industry; there are thought to be significant offshore and onshore hydrocarbon reserves that are just beginning to be explored. There is also a slim chance that relations with neighbouring Venezuela could worsen too. Venezuela lays claim to the Essequibo region of Guyana, a site of potential offshore oil exploration. In October 2013 Venezuelan authorities seized a ship and crew hired by a US oil exploration firm in these disputed waters. Mr Ramotar says that under Venezuela's former president, Hugo Chávez (1999-2013), relations were cordial. Mr Ramotar has expressed his concern that under Venezuela's current president, Nicolás Maduro—who is suffering both politically and economically at home—the Essequibo could be used to score domestic political points.

Mr Ramotar has a tough few months ahead of him as the opposition ramps up criticism and begins to unite. Traditional supporters have also begun asking questions of the president. If the AFC can show that it is a viable alternative, the PPP/C's more than 20-year rule may be challenged.