Guyana’s economy improves, despite rice, sugar shortfalls

Last Updated on Monday, 8 August 2016, 12:35 by Denis Chabrol

Guyana’s economy has registered an improvement during the first six months of the year largely due to improved gold performance but it is projected to decline slightly due to poor performances of rice and sugar, Finance Minister, Winston Jordan said Monday.

“This very good performance was attributed mainly to growth in the mining and quarrying sector,” he said.

He said latest projections are that Gross Domestic Product would increase 4 percent instead of the original forecast of 4.4 percent because of continuing unsatisfactory performances in rice and sugar. “The outlook is still good. Because of the shortfall in rice and sugar in the first half which we are not projecting to be made up in the second half which would be sort of offset by the substantial increase over budget by gold,” he said. He recalled that during the tabling of Guyana’s Budget earlier this year, gold declaration was projected to be 550,000 ounces  but it is now expected to be 650,000 ounces.

Speaking ahead of the tabling of the 2016 Mid Year Report in the National Assembly, Jordan said the economy grew by 2 percent from January to June, 2016 compared to 0.9 percent during the for last year.

He attributed the “very good performance” to a 65.7 percent improvement in the mining and quarrying sector where gold increased by 94.3 percent and bauxite 2.9 percent .In the area of agriculture, other crops contributed 2 percent, livestock by .8 percent and fisheries 2.1 percent.

The Finance Minister said the Mid Year Report would show a 10 percent decline in agriculture due to a 30 percent and 26.2 percent shortfall fall in rice and sugar production and 13.1 percent drop in forestry. The poor performances in rice and sugar, he said, account for the overall 14.1 percent drop in the manufacturing sector.

“Healthy” foreign reserves are now US$634.6 million, up from US$626.9 million. Inflation is now 1.1 percent and credit to the private sector has increased 3.9 percent pushed by personal lending which increased 19.3 percent and mortgage up by 4.9 percent.

The report states that revenue collection has increased by 9.7 percent.