Gold remains king, sugar earnings decline 13%

Mar 25, 2014 News

– domestic lendings up whopping 25%; bauxite falls 24%

Export earnings from gold continued to serve as a mainstay of the country’s economy, raking in US$649M last year despite a major drop in price on the world market that worried operators.
In a year characterized by political impasses and threats of snap elections, domestic borrowing also increased a whopping 25 per cent to $123B, as manufacturing, construction and engineering remained strong.
In his review of the 2013 performance during his presentation of the 2014 National Budget yesterday, Finance Minister, Dr. Ashni Singh, disclosed that the non-sugar gross domestic product, recorded growth of 5.2%, with the period 2006-2013 representing the longest uninterrupted growth since independence.
Sugar contracted 14.4% as labour shortages and disruptions, irregular weather and managerial capacity constraints severely challenged the sector. As a result, sugar earnings fell by 13.6% to US$114M. Further, even though sugar prices increased by almost six percent to US$713 per tonne, export volumes fell 18.7% to 160,284 tonnes because of poor production.
According to the Minister, in his 78-page presentation in the National Assembly, rice in its best production performance in history at 535,439 tonnes, grew almost 27% over the previous year.
This resulted in rice exports raking in US$240M with almost 395,000 tonnes exported to Venezuela, Jamaica and other markets.
Livestock grew by 4.3% while fisheries declined by 6.5% due to overfishing, which last year saw several licences for trawlers being suspented.
Forestry grew by five per cent with total production of 398,964 cubic meters. So did mining and quarrying. With gold production almost a tenth more than 2012, diamond declarations which had taken back seat in recent years, jumped by 57%.
Last year, the country’s export earnings, amidst a drop in gold prices, fell by three percent to US$1.4B.
Bauxite exports did badly, contracting to US$134M due to a 24.7% decline in export volume to 1,678,971 tonnes. Meanwhile, timber exports earnings dropped by a little over one percent to US$38.5M.
Guyana last year also saw lower merchandise imports which fell 7.5% to US$1.8B. Families also were sending less money from overseas with remittances suffering a US$141M reduction to US$328M recorded.
In the areas of foreign direct investments (FDI), there was a reduction from US$293M to US$214M.
In the areas of domestic credit, there was major lending to both the private and public sector, increasing by 25% to $123B.
As a matter of fact, the Minister said, credit to private sector expanded by 14% for the manufacturing, construction and engineering sectors, while personal and real estate sectors grew by 22%, 18.8%, 17.4% and 16.9% respectively. In addition, credit to mining and quarrying grew 14%, followed by agriculture and rice at 13.7% and 9.9%.
Last year also, Guyana’s five-year deal with Norway for payments to protect the local forests saw US$135M of the US$250M promised being approved for Guyana.
Regarding tax collections, the country saw $51.7B collected, a 6.3% improvement over the previous year.
Personal income tax dropped by $955M reflecting a reduction in personal income tax rate from 33 1/3% to 30%.
In total the much touted Value Added Tax (VAT) saw $34.4B being collected, an 8% increase over 2012.
Guyana’s external debt is at US$1.2B, some 8.3% less than 2012 as a result of the debts owed to Venezuela on the oil-for-rice Petro-Caribe deal being cancelled out.

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