AFC will remove darkness and ignorance

Oct 05, 2011 Letters

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Dear Editor,
Please allow me to respond to several points raised by “Peter Allen” in the Kaieteur News of October 4, 2011. I must be doing very well when the PPP attacks me personally for exposing the myths of economic progress and the misinformation in the data the members’ release.
I have been exposing their lies in a series of Wednesday columns in the Stabroek News. I have also credited the Jagdeo Administration with being able to maintain macroeconomic stability in Guyana.
I will continue to write the truth and do my duty. As someone with years of experience as an economist at the policy and academic level, I have a duty to teach and educate Guyanese about the reality on the economic front.
Whatever the outcome in this election, I know I can sleep well twenty years from now when I look back. I would have done what I was educated to do.
First, the letter accuses the AFC Action Plan of proposing backward macroeconomic policies for Guyana. Well the Action Plan (AP) not only has macroeconomic policies, but also sector policies, industrial policies, micro policies, financial policies and much more. The AFC Action Plan is meant to correct the mediocre rate of growth of Guyana’s GDP and to shift growth to higher value industries and services. It is meant to put a stop on the dubious policies of the Low Carbon Development Strategy.
We have diagnosed the problems and are able and ready to correct them by implementing the AP. The AFC believes we can achieve a growth target of 7% to 8% each year instead of the average of 1.95% during the Jagdeo years.
We intend to correct the present backward economy in which consumption is propped up by remittances (40% of GDP) and a massive underground economy. We have proposed a comprehensive set of interlocking policies to upgrade the production structure into high end services, manufacturing, renewable energy, agro-processing and small businesses.
To achieve these things we must raise the private investment rate in Guyana by allowing local companies to flourish (instead of discriminating against some), bringing in diaspora investments and foreign investments.
I will not get more into the detail but anyone is free to read the AFC’s AP for Guyana. It outlines all the macro and sector polices and how these are to be financed. It is on the AFC website and hundreds are going to be distributed all over Guyana. Kindly read.
Second, “Allen” makes an absolutely false claim that a simple Google search will reveal certain data I questioned. In my columns, I sought to put into context the average rate of growth under Jagdeo, which the data will show was a lukewarm 1.95% from 2000 to 2010. I also explained that if the Minister of Finance (MOF) can produce half-year GDP just before an election, what was preventing him from getting quarterly statistics, given how critical these are for managing the economy?
I said the MOF appears more concerned with electioneering rather than the scientific management of the economy. I stand by that statement. I also explained that Guyana does not have regular unemployment data so no Google search can help that. Barbados, Jamaica and Trinidad and Tobago can produce quarterly unemployment rates. What is the matter with Guyana?
Barbados, Jamaica, Belize and Trinidad and Tobago can produce GDP on a quarterly frequency. Why is Guyana unable to do this? How come they suddenly found half-year statistics two months before the election?
Third, the PPP is famous for its perpetual excuses. “Allen” says that the Bureau of Statistics does not have the capacity to obtain quarterly unemployment and GDP statistics. He cites the lags in the production process. You will always have lags so that is why you update the statistics next quarter. This is a simple matter.
Isn’t the PPP Government responsible for making sure that the Bureau of Statistics has the capacity to do these things? The AFC is a serious party and we will make sure the data are available for everyone. We want to remove darkness and ignorance. To do so we must measure things and have statistics.
We will manage the economy in a transparent and scientific way where propaganda will become secondary to light and truth.
Fourth, “Allen” invented a stupid concept which he termed “incremental growth”. This is his excuse for the mediocre average growth of 1.95% from 2000 to 2010. His point is it is not possible for Guyana to grow faster.
This is a totally erroneous notion since it is well known (the growth models tell us this) that a poorer country coming from a low base will grow faster than a mature or developed economy.
It is the convergence principle.  Therefore, Guyana ought to have grown faster than 1.95% since 2000, particularly since most of this period the world economy experienced an economic boom.
Also, we still had the goodwill of 1992, which has now been squandered today. Moreover, “Allen” appears to have a problem with the most basic statistical concept known as the mean versus an observation. I’d be glad to offer him free tutoring on basic mathematics and statistics.
Finally, “Allen” wants me to learn economics 101. Well, let me put it this way. I teach things like econometrics and upper level university courses. I am an external examiner for PhD dissertations and so on. I have published ten peer-reviewed papers in scholarly journals on the Guyana economy alone.
This does not include other invited peer-reviewed works I did for the UN, Intergovernmental Panel group of 24, Schwartz Center for Economic Policy Analysis, Stabroek News columns and various working papers on the US economy, published papers on Caribbean economies and some African economies. My PhD dissertation on Guyana and Caribbean has a theory that can be applied to the US money and credit markets. This idea can be downloaded here: http://www.newschool.edu/nssr/subpage.aspx?id=70818
I have also been told that Mr Ramotar is an economist. President Jagdeo is an economist and Minister of Finance Ashni Singh is a PhD in finance and accounting. Therefore, here is my challenge: could “Allen” please provide the peer-reviewed academic works of these individuals? To make matters easier, I will urge “Allen” to throw in the political science peer-reviewed works of Prem Misir also.
Let us tally up the number to see if three men have more than ten peer-reviewed works (self-publications don’t count) on just Guyana. Let us stick to Guyana because I don’t expect these gentlemen to be studying other economies. I will write another letter reminding “Allen” about my fair challenge in about two weeks.
Tarron Khemraj

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