Guyana predicted to see second highest economic growth in South America in 2014

Published on May 8, 2013, Source

GEORGETOWN, Guyana (GINA) -- The International Monetary Fund (IMF) in its World Economic Outlook, released on Monday, predicts that Guyana is expected to see the second highest economic growth for South America in 2014, just behind Peru.

The IMF said Peru is forecast to have the highest economic growth of 6.1 percent and the lowest inflation in South America in 2014, followed by Guyana at 6 percent, Bolivia- 5 percent, Chile and Paraguay at the same rate of 4.6 percent, Colombia and Suriname each pegged at 4.5 percent, and Brazil and Uruguay at the same level of 4 percent.

Meanwhile, the countries predicted to register the lowest economic growth are Venezuela with 2.3 percent, Argentina pegged at 3.5 percent and Ecuador with 3.9 percent.

The report also states that the country predicted to post the strongest economic growth this year is Paraguay with 11 percent, followed by Peru and Guyana with 5.5 percent, Chile with 4.9 percent, followed by Bolivia with 4.8 percent and Suriname 4.5 percent.

Countries predicted to have lowest economic growth are Venezuela with 0.1 percent, Argentina, 2.8 percent, Brazil, 3 percent, Uruguay, 3.8 percent and Colombia with 4.1.

Finance Minister Dr Ashni Singh, in his 2013 National Budget presentation, had stated that “bolstered by our unswerving commitment to task, our government ensured the preservation of a policy environment that remained conducive to economic growth and social development throughout 2012. The result was a seventh consecutive year of real growth in our economy and associated strong macroeconomic performance, continued diversification of the productive sector, substantial progress on catalytic infrastructural projects, further strengthening of our social services, and visible improvements in our regulatory and institutional environment.”

Looking ahead to 2013 and beyond, Singh stated that government’s policy agenda continues to be aimed at building a Guyana that is truly a land of opportunity and prosperity for all, and it will remain undaunted and unfazed in the quest to realise this vision.

“To this end, we will continue to be guided by the seven prerequisites outlined last year, namely, a strong democracy, reliable and efficient institutions of state, long-term macroeconomic stability, economic diversification and growth, expanded physical infrastructure, high quality social services, and environmental responsibility and sustainability,” he said.

All of these priorities, the minister stated, are reflected in Budget 2013.

The World Economic Outlook is a survey published twice and partially updated three times a year by the IMF. It portrays the world economy in the near and medium term context (basically four years). It forecasts include the macroeconomic indicators, such as GDP, inflation, current account and fiscal balance of more than 180 countries around the globe and deals with major economic policy issues.

Mr Demerara_Guy is getting exited over bogus statistics. Mr DG why is the government hiding the statistics? 

You think is the same as collecting dollar Bills at Gaumont!!!

Everyone in Guyana knows that PPP cooking the statistics. 

Well, like some of the opposition, you have to punt to the ridiculous

please point out the "ridiculous" part mr pretend economics maven

If people read the IMF report it isn't really that glowing.  It basically says that Guyana is growing because gold prices are high, thus boosting exports and attracting foreign investment.  Also that the govt is flush with revenues because it squeezes the poor with VAT, and it is realizing the benefits of assorted debt forgiveness programs.

Don't see any where that Guyana is benefitting because its economy is transitioning from a reliance on a few raw commodity exports to one that is realizing greater value added through enhanced processing of its commodities, thereby some what mitigating commodity price volatility.

So when gold prices drop, and consumption stagnates as remittances decline, what then?  Because as parents die, children become adults and migrants become less connected to Guyana as the original migrants die off, what then?  People of Guyanese parentage born outside of Guyana are less likely to send remittances to people living in Guyana.

And what if people are right that there is a real estate bubble, which will pop at some point?  Then there goes the vibrant construction sector as well.

Doesn't matter if they are or aren't, though the PPP has yet to furnish credible evidence that there is broad based poverty reduction.  It is quite evident that of gold was only US$500 Guyana would be a mess.  Sugar is down to where it was under PPP rule. The manufacturing sector hasn't developed. 

The only sector which one can credit the PPP for its rice.  Both in terms of exploiting new markets in Latin America and encouraging increased production.  But even here are we exporting processed rice, or just bare. paddy?  It would be good if one was able to buy a Guyana branded product in Colombia rather than us supplying one of their brands for basement prices.  Or sending the cheap rice that only poor people use.

Notice that the PPP soup lickers avoid this part.

Essentially Guyana is seen as being very vulnerable to volatile commodity prices as we are an economy which is highky dependent on the export of a narrow range of commodity products.

Please note that the IMF always advocates that third world countries destroy their populations with high consumption based taxation.  Guyana did it even though it doesn't have the revenue constraints that other CARICOM countries have because we have benefitted massively from debt forgiveness, as most of our debt comes from international agencies, unlike theirs which is often raised in the private global markets.

If you are precise with your statement, show and challenge the Government with your information.

Let me rephrase the question.  Why is the PPP taking credit for the fact that much of this growth comes from high gold prices and the spill over effect on the economy.  Plus the fact that Guyana's poverty has allowed it to have debt write offs that even smaller and much more vulnerable OECS islands cant get.  They best they get is a a debt reschedule.  So Guyana doesn't have the economic drag that excessive debt service creates.

What is missing is a solid analysis of specific steps taken by the PPP to reduce Guyana's dependence on a narrow range of almost totally unprocessed commodities,   and the vulnerability to price volatility that results.

Sweet Sweet Guyana.

You are an eternal pessimist when it comes to Guyana. Despite all your tears on the country over the past decade, it continues to progress.  It will be up to the private sector to determine the next economic solution for Guyana if or when mining and remittance dries up.  Meanwhile I contend that govt should have a laissez faire policy when it comes to industry. Let the free market determine what is profitable and feasible. As you will see, govt did a wonderful job with the bauxite, rice and sugar industry to the point where it is on the brink of extinction in Guyana. When you die hard communists shout that govt should be running industry you should remember Russia, China and the old Soviet block and realize that it is only when the private sector took over businesses that progress was seen.

Carib and his lazy brothers are always pessimistic. Hard working Guyanese are the are the successful ones. Sadly, Indo Guyanese remain the targets of the PNC.

I like 2 c growth translate into better standard of living. If I doan c poor ppl getting up in life, then that ain't growth. More like the rich getting richer.

And your point is?

Your choice to determine it relative to your question.

This is all what the voters want to hear...

I am tired with this shit that is going on in Guyana.

The population is shrinking and the government is building houses that they don't need.  The opposition is hell bent in destroying the country so they can get elected.  Many hotels are being built but the people stay with their families and squeeze them dry. The best jobs are with the government and those who work for them are very poor.  

Merry Christmas, Guys..     

D_G while reading the first post - the IMF report I had several responses, but as I kept reading I noticed that CaribJ mad some of these for me. I shall frame my responses in my own way, as responses to CaribJ seem to be on a plane that doesn't do justice to this Board or it's readership.

The IMF report stated that macroeconomic conditions were enhanced by rising commodity prices (read "Gold"), VAT, debt relief and Foreign Direct a Investments. As someone who is pulling for Guyana and is optimistic about its people and resources, I'm encouraged by the foreign investments. I know that some here argue over the quality of the investments - are they aided by State assets surreptitiously going to shell companies of friends, etc. we need to counter balance this by showing investments by reputable foreign companies and in areas that make sense for growth. I can think of solar energy panel investments and non-traditional produce whose transformation into exportable value-added items that make us feel good. We need to see what the bulk of the foreign investments is. 

Like you I cannot be encouraged by a macroeconomic resurgence that has as key contributors debt relief and raising taxes on consumption. The latter takes money out of people's pockets. It's nice to know that State economic enterprises are making surpluses, but again this net income does not go directly to the people who can make better consumption decisions. These surpluses go to balancing accounts.

The questions to ask would be how is the macroeconomic management fostering private domestic investments and raising the skill level of the population. The IMF report does not speak to economic transformation. This latter point is especially important in examining that other driver of macroeconomic resurgence - gold price surge and Guyana's increased output to take advantage of this. What happens when economic conditions globally revert to historic norms and gold price drops? Like you I would be concerned about a reliance on volatile commodities pricing for my macroeconomic resurgence. Don't you think?

talking about die hard communists, can you explain why the PPP described itself as a Marxist Leninist party until maybe 10 years ago?  Had Hoyte not dumped Burnhams's socialism your PPP boys would still be waving Karl Larx, and hailing Fidel Castro as a true champion.

Now as to the private sector.  Please explain why Marriott is being built by the govt and Guysuco hasn't been privatized.  Now most would think that building roads to the interior would make mote sense than erecting a 3.5 star hotel, but communists were never able to think straight.

Explain why you support a PPP, which at its roots is communist, just that they like to steal better?

so druggie what do you think?  Or does the fact that the PPP engages mercenaries to protect wealthy elites your only concern?

Answer Kari directly as your attitude towards me is determined by your hatred of blacks.

Merry Christmas D_G. The PPP/C is blessed to have an AFC as it's moral compass. 

PPP dackta the figures just like doctor 5.

Dem bais cookin de numba long time now.

Whatever the growth is subtract 2.5%. They are liers.