Gold generated export receipts totalling US$281.7 million, which represents more than the combined receipts earned for rice and sugar during 2009. According to Singh, “the export earnings from gold benefitted from an 11.2 percent increase in average export prices, which induced higher production levels, drove export volumes up by 24.4 percent to 311,884 ounces, and generated a 38.3 percent increase in export receipts”. In the 2009 budget, Singh had projected export receipts of US$165.5 million.
Singh noted that for last year, while the volume of sugar exported increased by 3.4 percent to 212,131 tonnes, the country recorded a 10.2 percent decline in export receipts to US$119.8 million. The average export price declined by 13.1percent, Singh said. He noted that this was attributable to the third and final step of the European Union price cuts taking effect on 1st October, 2009 – in total a 36% cut. For 2009, Singh had projected earnings of US$153.2 million, while for this year the Finance Minister has predicted export earnings of US$123.6 million.
Rice exports, on the other hand, also increased by 32.9 percent to 260, 815 tonnes but the average price declined by 27.3 percent. “Consequently, rice exports receipts declined by 3.3 percent from the previous year to US$114.1 million.” The country had recorded US$118 million in rice export receipts in 2008. Rice exports are expected to earn US$99.5 million for the year, Singh estimates.
For this year, exports receipts are budgeted at US$776.5M based on the strength of increased output in the sugar and bauxite sectors, Singh said on Monday during the budget presentation.
The Finance Minister, meanwhile, said that “the balance of payments reflected significant improvement to end 2009 with an overall surplus of US$ 234.4 million, compared with a surplus of US$5.6 million in 2008. He noted too that the current account deficit had been reduced by 31.6 percent to US$219.7 million, largely due to significant contraction in the total value of imports.
The Finance Minister added that the overall balance of payments for this year is expected to return to a deficit of US$11.3 million. The current account deficit is projected at US$263.8 million, which is attributed to higher levels of imports mainly due to higher world market prices for oil, which outweigh the projected improvement in export earnings.
Further Singh said that “merchandise imports declined by 11.7 percent to US$1,169.2 million. This was driven primarily by a 32.5 percent decrease in the value of imported fuel and lubricants on account of price.
He noted that other imports declined by 1.8 percent, with non-fuel intermediate goods declining by 10.3 percent, while consumption and capital goods increased by 2.9 percent and 1.7 percent respectively”, he said.
Meanwhile, the Minister stated that the “net current transfers contracted by 8.9 percent to US$299.6 million, with receipts from worker remittances declining by 4.3 percent to US$262.1 million, in line with regional trends.”
The country’s Capital Account ended the year with a surplus of US$454 million aided by an allocation of US$108.6 million of Special Drawing Rights by the International Monetary Fund, Singh said, while also noting the benefit of a “13 percent increase in net private investment” to US$208 million. This was driven by a net repatriation of portfolio investments, the Finance Minister explained.
Significantly, the overall balance of payments surplus enabled the Bank of Guyana to increase its external reserves position by US$272 million from US$356 million at the end of 2008 to US$628M. This figure is the highest ever recorded, Singh stated.
