Guyana needs to breathe again

Jun 09, 2020 Features / Columnists, Peeping Tom

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Now that the elections recount is over, it is time for the other immediate priority to be addressed: the COVID 19 epidemic. Unless this problem is brought under control through more enlightened policies, the country’s economic problems will be further exacerbated.
Even before COVID-19 reached Guyana, the country had a huge hole in its economy. The Checking Account at the Bank of Guyana which had a G$15B surplus in 2015 now has a negative balance of more of than G$82B.
This amounts to US$400M in the red, more than the country will earn from oil this year. In fact, the projected US$300M in oil revenues will have to be revised downwards given the steep decline in oil prices in recent months because of the COVID-19 pandemic.
COVID-19 has made things worse. Business is at a standstill. Many workers are unable to make ends meet. The poor are finding it difficult to put food on the table because of the restrictions which are in place to contain the spread of the virus.
The country’s financial system is under stress. Most of the persons who owe the banks will have to have their loan payments rescheduled. This will place tremendous pressures on the financial system which, if it collapses, will bring the entire economy down with it.
Small businesses are already facing the crunch. Many vendors have complained that they are unable to vend their wares because of the restrictions. They have bills to pay and their suppliers want their money.
Even before the elections, the rural economy was in a dire state. The closure of the sugar estates and severance of thousands of workers have led to a depressing situation in rural communities. Heavy taxation has not helped.
Unless COVID-19 is brought under control, these and the myriad of other problems in the economy will worsen. COVID-19 therefore has to be the number one priority for the new government. The economy needs to be reopened but this has to be done carefully so as to not lead to a spike in infections.
The past six days have seen only one additional case, but a decision on when and how to reopen the economy and put people back to work cannot be based solely on the number of new cases or the growth of new cases. The more important metric is the reproduction rate of the virus for which the government has not been forthcoming.
Fortunately, PAHO/WHO has been. Two weeks ago, they reported that the reproduction rate was 1.3. This is not as serious as in some other countries but it is still far too high to risk a return to normalcy. Unless the rate reaches 0.7, it would be ill-advised to reopen the economy.
A number of Guyanese who were stranded overseas are now being readmitted into the country. Most of them are coming from COVID-19 hotspots and therefore they are required to undergo a test for the virus at least 48 hours before travelling. Upon arrival here, they are expected to be quarantined at home for seven days. Why are these persons not being tested immediately upon arrival? Anything can happen in the 48 hours between when they were tested overseas and when they arrive here.
The public has a critical role to play in containing the spread of this highly infectious and deadly virus. But the daily health bulletins which are issued by the government is so sparse that the only consolation it offers is the news about how many new infections there are.
Unless there is a new and more effective local approach to this pandemic, the economic impact will be greater. A number of businesses, in the entertainment and tourism sectors will find it difficult over the next years. People are not going to frequent the bars, the cinemas and even the malls as much as before. This will hurt these businesses. Persons will not travel as much as they did.
Right now, businesses are breaking at the seams. Some non-essential businesses have had no choice but to violate the social restrictions and open. They simply cannot afford to lose any more money. They still have payments to make to banks and suppliers and there is no income.
Guyana has been holding its breath for far too long. The country’s economy needs to be taken off its ventilator. It needs to breathe on its own again.
And this is why it is important that the country gets a government as early as possible. The faster we get a legitimate government in place, the faster the country will be able to tap into the many sources of international finance which will be needed to help the economy recover. There is a lot of work to be done.

(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper.)

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