Guyana’s economy is projected to grow by 5.6% this year, according to Finance Minister Dr Ashni Singh who proclaimed the eight consecutive years of growth up to 2013 as the longest streak in the country’s history.
Presenting the 2014 budget yesterday in Parliament, Singh projected that the inflation rate this year will be 5% compared to 0.9% last year, the lowest rate in decades. Real Gross Domestic Product (GDP) grew by 5.2% last year while the non-sugar GDP rose by 6.3%.
While he played up expectations for this year, the Finance Minister also acknowledged that foreign exchange
earnings contracted in key industries last year. Export earnings reduced by 2.8% to US$1.4 billion.
Sugar production sagged by 14.4% in 2013 to 186,770 tonnes – the lowest figure in 22 years. This translated into a contraction of 13.6% in export earnings to US$114.2 million as a result of the decline in export volume to 160,284 tonnes. Guyana’s all important European Union quota of 167,000 tonnes was unmet and the shortfall was not offset by the 6.3% increase in the price of sugar to US$713 per tonne.
Last year, rice saw bumper production of 535,439 tonnes, 26.9% higher on the back of the PetroCaribe fuel barter agreement with Venezuela and the highest ever annual production. As a result, rice export receipts grew by 22% to US$239.8 million due to the 18.2% rise in export volume to 394,989 tonnes. There was also a 3.4% increase in the average export price to US$607 per tonne.
Gold exports totalled US$648.5 million, a 9.5% decline compared to the previous year.
This, Singh said, was a result of the decline in the average realized prices to US$1,344 per ounce compared to US$1,575 in the previous year.
The drop was registered despite a 6% appreciation in export volume to 482,527 ounces. Gold earnings were greater than sugar, rice, bauxite and forestry combined.
Bauxite earnings also contracted to US$134.6 million as a result of a 24.7% drop in export volume to 1,678,971 tonnes. This, despite the 18.6% hike in export prices to US$80 per tonne. Timber export earnings also dropped by 1.4% to US$38.5 million primarily as a result of lower export volume.
Singh said that production of other crops grew by 4.2% while livestock output climbed by 4.3%. The fisheries industry saw a drop by 6.5% due to overfishing, Singh said. This resulted in the suspension of the issuance of further industrial fishing licences and a drop in the operational trawler fleet. The forestry industry grew by five per cent with total output of 398,964 cubic metres.
The mining and quarrying industry was up by 8% over 2012 with the gold industry achieving 481,087 or 9.7% over the previous year. Singh boasted that the “…level of declarations represents the highest level of production in the history of the industry, exceeding production levels even when Omai gold mines were at their peak”.
Bauxite saw an 11% drop in value added production while diamond declarations jumped by 56.9% and stone output by 47.8%.
The Finance Minister said that the manufacturing sector grew by eight per cent reflecting mainly the growth in the manufacturing component of rice. He said the services sector recorded a 5.5% growth led by the construction sector which jumped by 22.6% “as a result of vibrant expansion in private sector construction buoyed by the national housing drive and by commercial construction, as well as implementation of public sector construction projects.
The information and communication technology sector grew by 5.9% while wholesale and retail trade dropped by 0.9% due to a reduction in the imports of consumption, intermediate, and capital goods.