Economy to grow by 4.4%; inflation at 2%

Last Updated on Friday, 29 January 2016, 17:59 by Writer

Guyana’s economy is predicted to grow by some 4.4% in 2016, says Finance Minister Winston Jordan.

Jordan during the presentation of his 2016 Budget stated that while Guyana recorded economic growth of 3% in 2015, the economy will rebound in 2016.

He said that having emerged from the disruptive year that was 2015, the clear expectation is that 2016 will be a year of recovery, a platform to put the economy on a higher growth path to realise the good life. 

“Accordingly, a growth rate of 4.4  percent has been set for 2016. Non-sugar growth is projected at 4.3 percent,” said Jordan.

There are predictions for growth in all the major sectors and central government revenue is projected to be at $172.3B – an increase of 7%.

“This growth will be driven by the expected buoyancy of tax revenue, arising from tax efficiency, enforcement and administration measures that will be announced later,” he stated.

Tax revenue is projected to increase by $7.6 billion, or 5.3 percent, while non-tax revenue is estimated to grow by $4 billion, or 21.7 percent.

 Value added and income taxes are projected to grow by 9.9 percent and 5.3 percent, respectively. 

The higher revenue from VAT will be as a result of closer scrutiny of import declarations, domestic manufacture and trading activities.

Prior to the presentation of the Budget Jordan had made it clear that the APNU+AFC administration was not ready to decrease VAT.

“If we are talking about VAT reduction, no – that’s not on our budget this time around, but it is still being considered,” Jordan had stated.

Jordan announced too that income tax compliance, especially among the self-employed, is expected to rise due to greater enforcement by the GRA. 

Both customs and excise taxes are expected grow by 6.8 percent and 0.7 percent, respectively. 

With the predicted increase in growth in almost all sectors, during 2016, the level of inflation is expected to be approximately 2 percent.