Considerable Differences

LUCAS STOCK INDEX The LSI rose by 0.2 percent in the second week of trading in February 2012. Only the stocks of Banks DIH and Demerara Distillers Limited (DDL) traded this week and they both rose by nearly one percent. As a result, the index recorded its edged up this week and reversed the declining trend of the last two weeks.

Differing Impressions

After listening to the Presi-dent’s speech before the Parlia-ment last Friday, it was easy to see why many Guyanese were left with differing impressions of his remarks.  The President provided the nation with an upbeat assessment of the economy and the list of things that he would like to see happen or take shape during his presidency.  To support his positive position, the President cited the performance of the economy since 1992 which expanded over 600 percent and per capita income which grew over 700 percent between the two points in time.  To add to his case, he cited the 1000 percent expansion of the assets of the commercial banks, especially loans which ripped off a 1500 percent increase over the last 18 years.   Adding the decline of interest rates by roughly 68 percent surely conveys a buoyant economy with a bright future.  That is so until one realizes that the physical condition of the country and the circumstances of the people were not included in the assessment.  At that point, the difference between the President’s view of life in Guyana and that of the people becomes considerable.


LUCAS STOCK INDEX The LSI rose by 0.2 percent in the second week of trading in February 2012. Only the stocks of Banks DIH and Demerara Distillers Limited (DDL) traded this week and they both rose by nearly one percent. As a result, the index recorded its edged up this week and reversed the declining trend of the last two weeks.

It might be the reason President Ramotar did not showcase in numbers either the amount of houses built or the number of households whose lives improved through homeownership during the last 19 years.  People are at the centre of development.  They contribute to changes in the country and they benefit from those changes.  The President referenced the things done in the area of health, but it would have been thrilling to hear the specific progress that was made in the area of housing. The Bureau of Statistics publicly highlighted the problem and the National Deve-lopment Strategy (NDS) articulated the outcomes required to fulfill the housing needs.  That we are left without a measure of progress in housing after a major assessment of the economy is truly disappointing.  Such an assessment would have put the achievements of the last 19 years in context and would have helped to update the global view of the human condition in Guyana as seen through the prism of UNDP’s Human Deve-lopment Index.

For most individuals, their largest investment is often a mortgage to build or buy a home.  New construction, in contrast to home resale, adds to the national income.  Mortgage balances are projected to exceed G$40 billion in 2011, indicating that investment in the construction sector continues to be substantial.  It would indeed be exciting if the greater share of mortgage debt is for private home construction, but the evidence is yet to emerge.  Even where that is happening housing construction might not be driven by locally resident Guyanese, especially when one sees newly-constructed houses being advertised for amounts clearly out of the reach of ordinary Guyanese.  With prices advertised in thousands of US dollars, housing demand appear to be driven by foreign-based consumers.


For the majority of Guyanese to feel that they are enjoying the fruits of the expanded economy, they must have a job and they must have money. The two go together, unless one is a highly-skilled investor whose money does all the work. The 600 percent expansion of the economy has done much for relatively few Guyanese. It is true that some Guyanese with fulltime work are rewarded handsomely, but it is also true that a majority is not adequately compensated. The work of reputable academics reveals that a substantial number of Guyanese cannot find fulltime employment with some either working part-time or periodically. Their in-comes are often insufficient to afford them a decent life.  Calcula-tions based on information in the 2011 Budget reveal that close to one-fifth of the workers enjoy less than 10 percent of the national income, indicating that the expansion of the economy has left them behind. It would have been equally nice to hear that the Labour Ministry, in collaboration with others, was in the process of preparing some strategy to bring more Guyanese into employment given the prospective employment opportunities in the mineral rich and natural resource sector.


Instead, the nation was treated to a human development policy couched in unhappiness at the continuous migration of trained Guyanese while content in its benefaction to those who are challenged and vulnerable. The expected job opportunities of the future require the development and upgrading of skills in science, technology, communications, finance, investments and other areas.  While there is an expressed commitment to improving education to meet the future employment needs, it was not clear how far this commitment would go, knowing that the future demand for jobs will come from among the youths, and the university will have to play a major role in their training.  Yet, the reference to Guyanese youths appears as a mere footnote to the future of the nation, and the faith of the university, a complete omission.  In addition, it was not clear that the commitment extended fully to those Guyanese who were described as “differently abled”.  The position articulated for this group seems intended to keep them in a permanent state of dependency.  One could only hope that this impression was the result of an unrefined description of the support for this target group rather than a neglect of their self-empowerment.  Their needs might be additional, but not necessarily different since many among them can benefit from special training and added resources to make them full, independent and productive participants in the national economy.


Much public investment has gone into the physical infrastructure of the country.  The quality of work however leaves much to be desired and often conveys the feeling that the effectiveness and presentation of the finished work is of no consequence. As a consequence, development looks haphazard. Roads deteriorate rapidly after construction.  Bridges collapse too. Culverts buckle sooner than they should.  There was no commitment to put an end to the disorganization and incompetence.  Further, the rapid flooding of city streets and low-lying coastal areas are the consequence of improper maintenance. In the city, alleyways, gutters and trenches are decorated with discarded food boxes, plastic bottles and other litter.  Where the disgusting adornment of the public drains cannot be seen, it is because the grass and shrub have grown so high and thick that they provide cover for the offending garbage while simultaneously stopping the flow of water.  Here too there was no commitment to tackle these quality of life issues so that neighbourhoods could be held accountable for keeping their drains and surroundings clean and help bring the mosquito infestation under control. The building of hospitals and health clinics to provide a cure is fine, but the country could save much more money if action was taken to prevent the health problems in the first place.


Described as a factor-driven country, Guyana is still at the bottom of the development pyramid.  It has a long way to go before becoming an efficiency-driven economy like Trinidad and Tobago or an innovation-driven economy like the United States of America.  There is no doubt however that getting to the next level of development was on the mind of the President when he spoke last week about “new high income and high yielding growth poles”.  But, the country must first take care of its basic needs and weaknesses.  According to the Global Competitiveness Report, factor-driven countries suffer from weak institutions with high costs of security.  They also suffer from an inefficient allocation of resources and inefficient production systems.  The bias in the functioning of public institutions, the inordinate control of resources by the public sector and the waste seen in the public procurement attest to that contention.  It was therefore disappointing that the President did not express a commitment to strengthen public institutions to bring better service to Guyanese and to improve resource allocation and utilization.


Still, there is some hope for a better management of the economy.  It calls for a broad dialogue on removing the obstacles to development and the will to make it happen.  There is also need for action designed to include more Guyanese in the participation and decision-making about the economy.  It is their country too and they must feel always that they are a part of it.  While the politicians have their work to do, the citizens have their role to play, and that they must do.


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