A word of caution

LUCAS STOCK INDEX The Lucas Stock Index (LSI) rose 0.78 percent in relatively light trading during the first week of trading in May 2013. A total of 98,790 stocks of six companies changed hands. Demerara Bank Limited (DBL) traded the highest number of stocks, 56,700 with a 0.33 percent increase in value. Demerara Distillers Limited (DDL) traded 16,000 with a gain of 5.63 percent. Meanwhile, Republic Bank Limited (RBL) traded 12,000 stocks for no change in value. After being dormant for a while, Caribbean Container Incorporated (CCI) traded 13,600 stocks which lost 15 percent of its value. In rather marginal trading, Demerara Tobacco Company (DTC) gave up 90 stocks with no change in value while Guyana Bank for Trade and Industry (BTI) sold 400 shares and saw the value of its stock increase by over 4 percent.

Upbeat news

In the space of two days, Guyanese got a series of upbeat news about the economy.  In a Stabroek News article of May 7, 2013, it was reported that the International Monetary Fund (IMF) predicted that the economy would grow by about 5.5 per cent during 2013.  On the same day it was also reported that the Latin American Public Opinion Project (LAPOP) found that more than two-thirds of the country had an upbeat view of life in Guyana.  Then one day later the Georgetown Chamber of Commerce and Industry (GCCI) disclosed the results of its second Attitudinal Survey taken among the membership of the organization.  The most prominent disclosure was that 91 per cent of the membership of the GCCI reported earning a profit in 2012.  The survey also revealed that over 80 per cent of its membership anticipates the economy to remain strong while 71 per cent of respondents believe that they will record even higher revenues this year. Two of the results were derived from opinion surveys while the other was garnered from a substantive analysis of the key variables of the economy by an organization that enjoys credibility, if not the full confidence of Guyanese.  In a way, the two opinions that originated from foreign sources could be interpreted as validating the findings of the local GCCI organization.  The Guyana economy has been doing well and gives rise to two questions.  One is what is responsible for the consistent growth of the Guyana economy?  And two, can this growth be sustained by widening current account deficits which seems to be a major contributing factor to growth?  A word of caution might be needed before the popping of the champagne.

To each his own

Before seeking to address the two questions, an observation about the LAPOP satisfaction survey is important.  While it is good to know that Guyanese are satisfied with their lives, the LAPOP survey might also be saying something about the quality of life that Guyanese are prepared to accept. Many would be amazed to know that Guyanese are satisfied with a standard of living that includes a filthy city and its environs with decaying garbage all around them.  It is amazing too that they are satisfied with drains, gutters and canals that are clogged with bush and rubbish, and give off horrible odour.  Eye-brows would be raised to know that streets that flood from the slightest rainfall and vehicle maintenance,