Latest update June 3rd, 2026 12:40 AM
A good report
Guyana’s economy grew by 2.2% for the first half of the year. The APNU+AFC may not be satisfied with that rate of growth, which is lower than it anticipated, but it should be pleased by the dramatic recoveries in the non-sugar, agricultural sector of the economy.
Rice and fisheries registered spectacular recoveries. Both of these sectors grew by over 30%. It may be the first time in living memory that these sectors have increased output so suddenly. The increase in paddy production, of course, would have increased both agricultural output as well as the manufacturing sector.
What the half year report on the economy, produced by the Ministry of Finance shows, is that agriculture is not the drag it has been made out to be. The agricultural sector can turn around the economy.
Gold, the shining star for the last two years, was off to a bad start. Production declined marginally, but gold is bound to rebound later in the year. The performance of other crops, fisheries and rice demonstrate why agriculture should not be neglected. It can quickly reverse poor performance in one year and in one crop.
The decline in sugar continued. But the decline has been slowed. Sugar should have been saved, but it cannot now be saved. The industry is responding to the suggestions which it has been receiving from the government. Those suggestions have been interpreted by sugar workers that the industry will eventually be phased out. The sugar workers are not going to stick around and wait for political change to reverse what they see as the inevitable closure of the industry. They are moving on.
The government has enjoyed some healthy revenues, most of it from taxes. The coffers of the state were increased by 13% in the first half of 2017, a very healthy increase in revenues.
The timing is perfect for wage increases for workers. Revenue is no longer an excuse. There was a substantial increase in revenues in the first half of 2017. Inflation, always a very controversial number, was exceedingly low by Guyanese standards. Therefore, the government should not be wary of spiraling inflation by increasing public sector wages substantially. The money is there.
The money is there for some persons in the State Asset Recovery Unit to be paid over million dollars a month. It should therefore be there to pay workers across the board more, far more.
The transfers to the sugar industry should no longer be used as an excuse. Nor should the additional funds which are required to improve the prisons! The coffer of the government is looking healthy with the 13.1% increase in revenues.
The mid-year review reveals something more fundamental. It shows that growth in the economy will depend on private sector growth. The growth in rice and fisheries was attributed to the private sector. Part of the recovery in the construction sector was due to increased private sector activity, particularly some large injections of investments and construction activity. The slowdown in the forestry sector was due to two major companies walking away from the industry because of the mixed signals that they were receiving from government.
What the mid-year shows is that private sector development is key to economic growth. The government, therefore, should focus more on promoting private sector development. It should support private sector activity and use the upcoming Budget to demonstrate its goodwill towards the engine of economic growth.
The mid-term review shows that the foundations of Guyana’s economy are strong. The coalition inherited some problems, but the economic base remains solid. It should not tinker with these issues.
It has a problem to fix with business activity. The problem is associated with a slowdown in sectors which have the greatest flow- through in the economy. It has to fix those problems and boost business development. It has to seek markets for rice, because production is going to disappear unless markets are found.
The government should not have revised economic growth. It should have boosted the failing sectors and promoted private sector development to generate increased growth.
All in all, the government should be pleased with the state of the economy in 2017 so far. Things could have been worse had agriculture not done so well.
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