DISMAL REPORT
The government has been in office for sixteen months but is yet to develop a solid plan or strategy to boost the economy, create jobs and improve the lives of the masses. Much more is needed than just talk. Words without follow-up action are useless.
By now the GDP growth rate should have been improving to reach four percent as forecast earlier by the Finance Minister. However, the claim by the opposition that the government has done little in the past year to prevent the flat-lining of the economy seems to be partially correct. The truth is the economy is indeed heading in that direction.
The assessment by the opposition is supported by a recent report from the Bank of Guyana, which evaluated the progress made during the past nine months. According to the Central Bank, the economy has not performed as expected, and all is not well in Guyana. The Bank stated that all the major sectors except the mining sector have experienced a lower growth rate and the country’s financial system faces serious threats that could result in a shortfall in revenue. However, Guyana’s GDP growth rate which is at two percent is still higher than most CARICOM states.
While the production of gold has increased by 94 percent due to rising prices on the world market, the Report highlights the fact that the earnings from sugar, rice, bauxite and timber fell significantly. The steep fall in production has resulted in a sharp decline in export earnings while the country’s import bill has skyrocketed.
The Ministries of Agriculture and Business, along with GO-Invest, have done very little to improve the economy. In fact, the Minister of Business has essentially admitted that there has been no significant foreign investment in Guyana in recent times – despite the trips to Canada, New York and elsewhere by several officials.
The Central Bank attributed the fall in production and export earnings to a weak global demand, inclement weather and unfavourable commodity prices on the global market, which are beyond the control of the government. However, the Bank predicts that expenditure in several areas, including construction, transportation and mining, will likely contribute to a higher growth rate and increased revenue by the end of the year due to stricter tax compliance measures.
Managing the economy has to do with creating and expanding opportunities for the population, especially as it relates to the creation of jobs, increased production and reducing the debt, which is roughly US$1.5billion. Strategies must be developed to reduce the foreign debt it inherited from the previous administration. Given the previous government’s failure to create jobs and reduce the debt, it is not surprising that the country has such an alarming youth unemployment rate, which is approximately 35 percent, and a general unemployment rate of 12.5 percent.
With the decrease in production in the agriculture sector, the government should focus on tourism, which has increased substantially in the past year. It should forge ahead with ecotourism, which has succeeded in Ecuador, Belize, Thailand, Kenya, and Costa Rica, among others, because of their rich biodiversity, which is an asset that Guyana also has. However, the success of ecotourism in Guyana is dependent on the government investing in infrastructure and inspiring confidence in the people by assuring them of the importance of ecotourism to the country.
The country’s image as a crime-ridden society must be improved in order to attract tourists. Canada’s warning to its citizens earlier this year to be careful when visiting Guyana does not bode well for the country and the tourist industry. It could eventually lead to fewer tourists coming to Guyana from that part of North America. But the country must maintain a positive image, both at home and abroad, if it is to compete successfully with its Caribbean neighbours for tourist dollars. It is a matter of addressing the issues that are needed to boost the development of ecotourism and tourism in general.