Saying that the country’s economy remains fragile, Minister of Finance, Winston Jordan, yesterday appealed to the Caribbean Development Bank (CDB) to step up in its support of Guyana’s projects portfolio, as the country anticipates a steep growth in public investment.
Jordan was at the time delivering remarks at the CDB’s 49th Annual Meeting of Governors, held in Trinidad and Tobago from June 5-6.
In his speech, the minister noted that while Guyana’s economy returned a growth rate of 4.1 percent, the highest since 2014, and showed a continuing trend of positive economic growth averaging three percent over the last four years, the economy remains fragile, and tremendous support is required going forward.
While he praised the bank’s support of the country’s development efforts last year, noting that Guyana benefitted from “a signal level of project approvals and a very respectable disbursement level of US $6.7 million”, and its project portfolio grew to US $150 million, he pointed out that these investments, which went to areas such as infrastructure and education, fell below the monies Guyana paid out to the bank.
“…as salutary as the Bank’s efforts have been, outflows from Guyana to the CDB were about US $4 million more than disbursements. While occasions of net negative flow to any country may occur, we expect that those will be infrequent,” Jordan stated.
“I, therefore, urge the Bank’s management to pay close attention to the repayment of loans and the pacing of loan and grant flows to its borrowing members. Like most of Guyana’s development partners and friends, the CDB has celebrated the news of our impending “good fortune,” Jordan said, referencing the oil reserves and citing the figure of over six billion barrels.
He noted that the oil resources will represent a “quantum leap” from the circumstances many are accustomed to, to a position where Guyana has the opportunity to significantly transform its economy and improve the lives of citizens. “But there are challenges: Guyana has major capacity and capability gaps, which must be filled, if we are not to experience the paradox of plenty—that dreaded cliché which spells sleepless nights for economic and financial managers,” he stated.
He went on to say that while Guyana’s GDP expansion is averaged to be 12% per annum for the next 10 to 15 years, the country needs to ensure that growth emanates from a modern, diversified and inclusive economy, one that is resilient and capable of withstanding and absorbing shocks without major disruptions.
Additionally, he noted that being aware of the risks that need mitigating, including “unstable public finances caused by volatile oil prices and diminished competitiveness of our local products”, Guyana needs to carefully plan and strategically think about the management of its fiscal affairs, and implement the solutions systematically.
And, with weak institutions, our administration will be further challenged. But we are up to the task,” he asserted.
“Guyana has many needs, assistance for which we look to our partners. I, therefore, enjoin the Bank to step up and provide us with the support we need, and offer the insights and guidance required. Help us to push our faltering project portfolio and build up a pipeline of bankable investment projects. With an anticipated steep growth in public investment, our Region’s premier lending institution must be in the forefront of Guyana’s charge to transformation,” Jordan stated.
