Finance Minister Winston Jordan said that the growth was important given the economic developments in other Caribbean countries.
“You may hear talk of anaemic growth or other negative comments but when our neighbours can’t even manage a zero per cent much less positive growth, 2.2 per cent is not to be scoffed at,” Jordan said, acknowledging that the growth for the first six months was “marginal”.
“It is not a decline which means that there is still spending. This spending is expected to increase as citizens become more confident and government policies will lead to sustained growth rather than be a “one off.”
He said that local spending is directly correlated to the performance of the agricultural sector particularly rice and sugar and with the latter’s underperformance spending is affected “if only because of the number of people employed directly and indirectly in those areas.”
According to the Mid-year report, sugar production was 49,606 tonnes, compared to 56,645 tonnes for the same period last year, a drop of 12.4 per cent. The shortfall was described as being due to Skeldon Estate’s lack of production, due to unsafe boilers and the need for significant repairs.
Joran said that if it were not for sugar’s poor performance, the economy would have passed the 3.8 per cent growth initially projected, “due to the poor performance of this sector projected growth has been reduced to 3.1per cent.”
The privately controlled rice industry performed creditably as government-assisted efforts to secure new markets, helped to boost sales. In the first half of the year rice production totalled 349,867 tonnes, a 31.6 percent increase over the same period in 2016.
Also helping to boost the sector’s performance was an increase in acreage sown, with officials indicating that the new markets in Mexico could potentially result in over one billion Guyana (One Guyana dollar =US$0.004 cents) in exports.
Jordan said that the rice industry was seriously affected by the collapse of the agreement Guyana had with Venezuela under the PetroCaribe accord, but noted that while efforts to reverse this have been gaining traction, “it will take a lot longer to get sugar righted.
“When we do it will not be like the halcyon days in the 1970s when 385,000 tonnes were produced. When sugar stabilises we will be seeing something like 150,000 tonnes. We will be spending far more money to produce far less.”
The mid-year report notes that the retention of sugar workers will be paramount during this rationalisation process of that sector ‘with some lands being leased to workers in order to facilitate their engagement in other agricultural pursuits.
- Countries: Guyana