Dear Editor,
I read with interest a report in the media in which it was stated that Guyana has been upgraded to upper middle class ranking by the World Bank. This most recent ranking is the result of an increase in the country’s gross national income and a satisfactory level of economic growth over the past two decades.
There can be no doubt that Guyana has come a long way in terms of economic growth since the early 1990s when the country was ranked among the poorest in the Western hemisphere. Indeed the country was at one time declared by the IMF as uncreditworthy and was saddled with a huge debt burden which consumed a significant amount of revenues and foreign exchange earnings.
The former PPP/C administration must be given credit for successfully managing the debt burden in a sustainable manner and for obtaining debt write-offs both at the multilateral and bilateral levels. Because of the poverty stricken state of the economy Guyana qualified for debt write-offs under the Highly Indebted Poor Country Initiative (HIPC) which freed up resources for social sector and infrastructural development.
One drawback in being elevated to middle income status is the possible withdrawal of aid and concessionary funding from the World Bank and other international agencies. One such example was the discontinuation of free milk and biscuits by the World Food Programme during the late 1990s after the country graduated from low income to middle income status. The then PPP/C government continued to fund the school feeding programme which had proven to be highly beneficial to children, especially those from low income families and hinterland communities.
The revised ranking of Guyana to upper middle income status, even though desirable from an image perspective, should not overshadow the fact that Guyana still ranks low in the UNDP human development index and therefore needs as much assistance as it could possibly get from the international donor community to confront its myriad developmental challenges. The potential for oil revenues later on should not be a factor in the country’s ranking due to the uncertain and risk elements which usually accompany such investments.
A major challenge facing the current APNU+AFC administration is to maintain the growth momentum set in motion by the previous administration and in so doing give true meaning to our elevated World Bank ranking.
Yours faithfully,
Hydar Ally
