Guyana’s economy continues to repel adverse shocks

Jun 07, 2010 Letters

Dear Editor,

The Guyana economy may not be as robust as some people may wish. And indeed, all of us would be extremely happy should we have an economy at Rostow’s economic take-off point.

Nonetheless, let us be pragmatic and try to picture the real situation; picture the condition of any developing world’s economy that an ailing global economy constantly impacts.

The Guyana economy continues to weather difficult storms, some of which still repel its growth.

We could see some of these difficulties as adverse shocks resulting from the floods of 2005 and 2006; the high oil prices that followed; the economic stranglehold that the World Trade Organisation (WTO) inflicts on poor, small, and vulnerable economies; the liberalisation of the European sugar regime with sugar price cuts; general erosion of trade preferences; constant migration of skilled professionals; the huge inherited external US$2.1billion debt, for which Guyana took about 10 years to reach financial and economic viability; among other types of adverse shock.

For this reason, factoring the ‘financial and economic viability’ years, we could arguably suggest that Guyana’s real developmental years commenced from around year 2000.

And again, for the reasons to do with financial and economic viability, I think, too, that we need to consider the fact that in the early post-1992 years, balancing debt service and meeting the needs of the poor constituted great challenges. All of these still have lingering economic and social impact on this economy, a small and vulnerable economy.

Nonetheless, in response to these shocks and to maintain its competitiveness, the Government of Guyana continues to diversify the economy to achieve some level of medium-term growth. Within this context, diversification and international competitiveness combined with a ‘technology’ vision correspond to the Government’s twin strategies of development.

The Government launched the National Competitiveness Strategy (NCS) in May 2006, comprising 122 actions and activities to improve national competitiveness.

This NCS contains 10 Action Teams as follows: Scoring Big for Guyana; Call centers & Contract Manufacturing; Guyana’s Next Agricultural Frontier; Financing Guyana’s Future; Creating the “Brain Gain”; Tapping into Diaspora Resources for Guyana’s Development; Maximizing Opportunities from CSME; Making the Five Year Tourism Development Plan Happen; and Forest Products.

The NCS happens in three ways: through the regular work of Government agencies and the private sector; through planned activities, as the Guyana Trade and Investment Support (GTIS), the Commercial Court Programme, the Agricultural Support Services Programme, and Linden Economic Advancement Programme (LEAP); and through new activities, as the IDB-funded Competitiveness Programme, and the Agricultural Diversification Programme.

National competitiveness will increase productivity; and higher productivity will boost investment returns, leading to a greater growth rate for the economy; this is not merely economic growth. And a key factor in all of this is macroeconomic stability that underlies competitiveness. Guyana has its macroeconomic fundamentals in place. Nonetheless, good economic growth rates are necessary but not sufficient to improve the quality of people’s lives. We have to advance beyond the parameters of economic growth to create a linked international framework with sustained democratic development.

And President Bharrat Jagdeo and his Government are aware of this salient fact. This Government recognises the strong correlation between sustainable development and the consolidation of democracy via international collaboration.

With the world becoming a global village, consider the Government’s relentless international and regional strategies to achieve sustained democracy and freedom; in fact, international and regional resources already are complementing local resources. President Jagdeo is aggressively leading the way toward this new horizon.

Very few countries could today avoid factoring in the ‘global village’ concept in their social and economic development strategies.

Within this context, President Jagdeo is now internationally accepted and a force to reckon with in international relations, especially in areas as climate change, reforming the International Financial Institutions (IFIs), a peerless advocate for the poor and vulnerable countries, inter alia. All of these portend well for Guyana’s democratic development and a better life for all Guyanese.

Prem Misir

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Guyana’s economy continues to repel adverse shocks

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