The current wave of development and prosperity in every sector has been a result of a robust five-year plan being implemented by the People’s Progressive Party/Civic (PPP/C) Government, which entailed a great deal of strategic efforts to lift the country from a rickety state of affairs and economic collapse.
In measuring his administration’s performance, President Irfaan Ali on Friday sought to analyse the APNU/AFC’s governance ‘matrix’ between 2015 and 2019.
When Government took office in 2020, the Head of State lamented, the planning foundation inherited from its predecessor had seen traditional sectors on a ‘free fall’. Gold reserves had been depleted, and there was a startling overdraft.
Between key sectors such as sugar, forestry and bauxite, the decline was $61.5 billion in less than five years – representing eight per cent of the 2019 Gross Domestic Product.
He said, “The sugar industry between this period fell, the aggregate production contracted by $21 billion. What that means is that production level in monetary value contracted by $21 billion. From where they (the coalition) picked it up in 2015 to the time they handed it over to us, it went downwards. The forestry sector declined by $31 billion under the APNU/AFC Government.”
Contractions in these sectors had cost the country more than US$283 million in potential export earnings. Additionally, gold reserves at the Bank of Guyana had fallen from $25 billion to $800 million – a decline of 97 per cent.
“Equally worrisome was the fact that the Central Government overdraft had increased by more than $114 billion, or by 540 per cent, during this period. The deficit by Central Government also increased from $9.3 billion to $30 billion.”
This was coupled with 200 new tax measures imposed on businesses and consumers – all of which have been reversed by the Ali-led administration to increase the spending power and disposable income of Guyanese.
The president zeroed in, “It led to an increase in tax revenue, but, more importantly, it led to the extraction of wealth from the pockets of people. Effective tax rate as of 2014 was 15 per cent, and that moved to 22 per cent under the last Government. That is, the people, in 2019, had to pay an average of 22 cents in taxes on every dollar earned…It’s important for our population to understand this.”
Private consumption during that time, which translates to the goods consumed by the common man, declined by $77 billion, falling from 82.7 per cent to 53 per cent.
“What this means is that our people were spending less. They didn’t have the resources to spend, and what it means (is) that the spending rate fell from 20 cents from every dollar earned in four years. Because why? The disposable income was not there!” Ali voiced.
Now bolstered by an expected ramping up of oil production offshore and persistent growth in key non-oil sectors, Guyana’s economy is slated to continue its growing trend for yet another consecutive year, with projections putting Real Gross Domestic Product (GDP) at a 34.3 per cent growth in 2024.
While initial projections had pegged the country’s real GDP to grow by 25.1 per cent in 2023, with non-oil GDP expanding by 7.9 per cent, this surpassed expectations and expanded by 33 per cent overall last year, with a “stronger-than-expected” growth of 11.7 per cent in non-oil real GDP.
Government said this was evidence of policies focused on supporting growth in the traditional pillars of the economy while managing the oil and gas sector effectively.
Consequently, the agriculture, forestry and fishing sector expanded by seven per cent in 2023. In the sugar sector, a 28 per cent growth was recorded last year. In the extractive industries, further growth in oil and gas and other mining and quarrying, as well as an expected recovery in the gold and bauxite mining subsectors, have been projected.
The sand, stone, diamonds and manganese subsectors are also anticipated to continue their momentum in 2024, with projected growth of 19.3 per cent.
Construction in 2024 will be maintained with a projected growth of 23.4 per cent, while the services industry will expand by 6.9 per cent this year with supported spillovers from the other sectors.