Gold earnings shine for Guyana’s economy

Mar 27, 2013 News

Gold last year continued its run as being Guyana’s biggest earner.

– country records 4.8% growth in 2012, VAT rakes in $58.6B

Guyana’s economy recorded a 4.8% growth rate last year with government projecting an ambitious 5.3% for 2013.
During his budget presentation Monday in the National Assembly, Finance Minister Dr. Ashni Singh did not surprise with disclosures that gold remained king of the country’s economy.
A rush to the interior amidst high world prices for gold has seen government smiling all the way to the bank.
It will be the seventh consecutive year that Guyana is recording positive growth rates and comes at a time when government would want to badly prove its critics wrong.
Last year, a combined opposition, buoyed by its one-seat majority, slashed almost $20B from the national budget. The cuts targeted Office of the President, the Government Information Agency (GINA) and National Communications Network (NCN). The matter had gone to court and government, much to the displeasure of the opposition, interpreted the ruling to restore the monies that were taken away by the opposition parties.
There have been attempts at talks during the preparation of the budget for the ministries, state agencies and regional administrations, but both government and the opposition have been blaming each other for a lack of progress.
Under the $208.8B budget for 2013, themed “Overcoming Challenges Together, Accelerating Gains For Guyana”, government made it clear that Guyana is poised to capitalize on a number of transformative projects, despite the challenging global crisis.
“Looking ahead to 2013 and beyond, our Government’s policy agenda continues to be aimed at building a Guyana that is truly a land of opportunity and prosperity for all, and we will remain undaunted and unfazed in our quest to realise this vision.”
Last year, the sugar industry contracted 7.8%, after delivering total production of 218,070 tonnes. Singh blamed this on industrial relations disruptions and inclement weather patterns.
Rice, meanwhile, recorded another year of outstanding performance, with total production growing by 5% to 422,057 tonnes, the highest tonnage produced in any one year in the industry’s entire history.
“Livestock production increased by 14.4 percent, driven primarily by heightened demand, especially in mining communities. The fisheries industry grew by 15.5 percent with an expanded trawling fleet in operation. The forestry industry recorded a 4.3 percent decline with total production of 369,645 cubic metres.”
It was the strong showing of the gold mining and quarrying industry that saw a 14.8% growth over 2011. “Declared gold production of 438,645 ounces was the highest recorded in the entire history of the gold industry excluding Omai production, and was 20.8 percent higher than 2011.”
The bauxite industry recorded growth in value added of 12.5 percent, with production of 2,213,972 tonnes.
However, “production of diamond and stone recorded declines of 22.2 percent and 10.8 percent respectively, while sand production recorded a 76.5 percent increase which, when taken together, resulted in the other mining subsector recording a decline of 14.6 percent.”
Gold export raked in US$716.9 million, a 38.7 percent increase over 2011, with the industry benefitting from a 6% favourable price movement and a 30.8% increase in export volume.
Sugar took in US$132.1M which increased by 15.1 percent, despite the lowest production.
According to Minister Singh, rice export grew by 13.3% to US$196.2M, underlying which were a 9.4 percent increase in volume and a 3.5 percent increase in prices.
Last year, total imports increased by 11.7% to US$2B.
Overseas-based Guyanese sending home monies to their families also helped boost remittances to US$419.2 remitted.
“The Bank of Guyana ended the year with total external reserves of US$862.2 million, the highest end of year position ever in our country’s history, and equivalent to four months of imports.”
Fisheries also saw a 15.5% increase in production, but forestry earning declined amidst tighter monitoring.
Last year, tax revenue collections, which represented 91.5 percent of total current revenue collections, amounted to $118.3 billion, a 6.2 percent increase over 2011.
“Value Added Tax (VAT) and excise tax collections increased by 7.2 percent to $56.8 billion with increased VAT collections from imports and domestic supplies, and increased excise tax collected on all categories of taxable goods except fuel.” (Leonard Gildarie)