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Guyana’s diamond declarations declined by 21.2% – Finance Ministry report
Kaieteur News – In its latest Mid-Year Report, the Ministry of Finance has revealed a significant 21.2% decrease in diamond declarations during the first half of 2023.
In a surprising contrast, the mining and quarrying sector witnessed substantial growth, surging by an impressive 89.9% in the same period. This remarkable expansion was primarily driven by increased output from both the oil and gas industry and the ‘other mining’ subsectors. However, beneath these overall positive statistics, there is a story of divergence within Guyana’s mining sector.
On the bright side, the ‘other mining and quarrying’ subsector, which encompasses the sand, stone, diamonds, and manganese sectors, exhibited robust growth of 45.2% during the first half of the year.
Sand and stone declarations soared by 52.6% and 71.7%, respectively, supported by heightened construction activity. The government’s continued investment in transformative infrastructure projects nationwide contributed significantly to this surge.
Diamond’s downturn
However, diamond declarations experienced a downturn, falling by 21.2% to 38,068 metric carats during the same period. Manganese production also faced challenges, with a notable decline of 21.9% due to operational constrains.
Looking ahead, the Finance Ministry said it remains cautiously optimistic. With construction activity expected to intensify in the second half of the year, the ‘other mining and quarrying’ subsector is projected to achieve a growth rate of 17.1% for 2023.
As reported by this publication, Guyana’s gold declarations have also faced a decline this year. The Ministry of Finance attributes this decrease to low declarations by small and medium-scale miners, resulting in an 11.4% drop compared to the same period last year. Large-scale producers, on the other hand, experienced a modest 6.1% year-on-year expansion.
Despite the mining sector benefitting from significant tax breaks and incentives, declarations have not met expectations for the first half of 2023. In August 2022, the National Assembly approved tax relief measures aimed at benefitting the mining industry, including a reduction in final tax rates and the removal of Tributors’ Tax.
Amid growing concerns about Guyana gold declarations decreasing, Vice President Dr. Bharrt Jagdeo, during a news conference in July, confirmed that the decrease in declarations is factual, but added that a probe has been launched into alleged gold smuggling.
For the past several months, Kaieteur News had reported on several foreign gold mining companies boasting to their investors about Guyana’s rich mining industry. Among those companies is OMAI, a company which produced over 3.7 million ounces of gold between 1993 and 2005 and is now making a comeback in Guyana’s mining industry with its gold properties: the shear-hosted Wenot Deposit and the adjacent intrusive-hosted Gilt Creek Deposit.
At the end of September, Omai is expected to update its 3.7 million ounces of gold estimates (indicated and inferred), after its return in 2020.
While foreign companies have been rushing to cash in on the “gold fever” in Guyana, the country has been suffering massive declines in its annual declarations since 2017 and Jagdeo is yet to honour his commitment to make all mining contracts public.
Kaieteur News had made several requests for the Government of Guyana to release the mining contracts, particularly large-scale mining contracts.
In 2019, when Guyana became a member of the Extractive Industries Transparency Initiative (EITI), the country agreed to adhere to several requirements. In this case, EITI requirement 2.4 (a) of the 2019 Standard states that Guyana should publicly disclose all mineral agreements entered into force prior to the reporting period, in this case, 2019.
Although the requirements were known to the administration, it continued to make excuses to avoid the release of these contracts.
- Diamond’s downturn, Guyana gold declarations decreasing, Tributors' Tax, Vice President Dr. Bharrt Jagdeo, Wenot Deposit
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