Good macroeconomic and agriculture initiatives

Jul 16, 2009 Letters

Dear Editor,
The recent economic shocks have consolidated and mutated into ‘an evil leviathan’ motivated to destroy the economies of countries.
It has proved itself that no country is immune to the unexpected economic shocks which are responsible for the fluctuations in national income, output and employment.
However, Guyana has managed to battle the lethal waves of this global tsunami and managed to maintain good macroeconomic fundamentals, with quite a stable inflation rate. It should be noted that, the inflation rate for 2008 was 6.40%, which was lower than the 14.05% rate in 2007.
Last year, Guyana managed to achieve positive growth rates of about 3%, which was slightly below the projected rate. According to the Bank of Guyana Half Year Report 2008, the overall balance of payments at the end of June advanced to a surplus of US$47.6 million from a deficit of US$12.3 million for the corresponding period in 2007.

With increased trade, the total transactions on the foreign exchange market continued to grow and the key monetary aggregates grew with increased economic activity.
Guyana experienced the impact of the rise in world fuel and food prices at the beginning of 2008. Food prices in Guyana increased by 27.2%; and Government increased the tax threshold by 25% from $28,000 to $35,000 per month and removed the Value Added Tax (VAT) from a number of items.
Government also implemented a cushioning package of which low-income public servants were offered a monthly stimulus package to aid the effects of the increases. There was a 5% increase in wages and salaries and the $4,000 temporary cost of living adjustment for persons earning below $50,000.

Food security was a major concern within the economy. As a result, the Jagdeo Initiative was discussed to revitalize the agriculture sector to promote food security. Since Agriculture is the foundation of Guyana’s economy and a major contributor to the nation’s Gross Domestic Product (GDP), it is vital to note that it has links to other productive sectors of the country’s economy, such as job creation, among other things. Rural development, the alleviation of poverty, and increasing household food security are also facilitated by the agriculture sector.
We must understand that inadequate demand increases unemployment; and so, it is important to ensure that there is a demand for goods and services by consumers, business investors and governments.
An increase in the market demand will re-fuel the economy, increase private investments and induce greater productive output. With the present rise in food prices, it is projected that in the year 2030 the global demands of food will double.

However, with the Grow more Food campaign onboard, it is estimated that this year the economy will benefit from a 2% growth increase.
Regions 1,2,7,8 & 9 are projected to increase on their spice cultivation. The Ministry of Agriculture also plans to embark on promoting good agricultural practices and appropriate post harvest handling techniques.
Last year, exports of fresh and processed agriculture produce estimated to US$7.76M. Farmers and homeowners received seeds and planting materials to expand on their business ventures, so as to boost food production levels. This initiative enables farmers to sell their produce at an affordable rate to benefit the people of this country.

Plans are underway for the Ministry to work in collaboration with international organisations to further strengthen the organic production of vegetables and orchard crops.
There have also been the establishment of model farms in Mon Repos, Timehri and Mahaicony creek, the commission of an $89M pack in Parika to sustain farmers in Regions 2, 3 and other communities.
And so, it is evident, that efforts are being made to maintain good macroeconomic environment and to boost the Agriculture Sector, both regionally and locally and make produce more cost effective for the people through the Jagdeo Initiative on Agriculture.
Marissa Lowden

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Good macroeconomic and agriculture initiatives

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