THE Private Sector Commission (PSC) says it is heartened at the announcement in Budget 2014 of a growth rate of 5.2% for 2013. The umbrella business organisation said the fact that this growth was achieved in the context of a less than stellar performance of primary commodities demonstrates that the economy is diversifying and becoming less dependent on the traditional pillars- agriculture and the primary extractive industries. 

(QUOTE) ‘The Private Sector Commission is satisfied that many of its recommendations and proposals for the Budget were taken on board and that, once approved, the further development of the private sector will be assured in 2014’

“The rebound of the manufacturing and forestry sectors, the performance of which has been dampened in recent years, is most satisfying,” the PSC noted.

The PSC said it believes that the measures contained in the 2014 Budget will stimulate continued growth and is pleased at the social provisions including the increase in old age pensions and the $10,000 per annum cash grant to parents of school-aged children. While the provisions for a 50% increase in the annual electricity subsidy for pensioners will undoubtedly provide much needed assistance to the elderly, the PSC is urging for the gradual removal of all electricity subsidies and that those funds are invested in social services in particular old age pensions, so that pensioners would have no difficulty in paying their electricity bills, there would be a level playing field for all consumers and energy conservation measures would more readily be adopted.

“Low cost energy with reduced dependence on the vagaries of commodity prices for imported fuel is critical to the development of the manufacturing sector in Guyana and, in fact, for job creation and the quality of life across the economy. We therefore welcome Government’s commitment to take all necessary steps to ensure the completion of the AFHP and, in the interim, for adequate maintenance and improvements to the electricity distributions systems,” the PSC said.

The PSC added that it is also pleased with the budgeted allocation of $1 billion for the cleaning up of the country and specifically the $500 million for Georgetown.
“It believes, however, that in order for the funds to be effectively utilised and targets achieved, there must be energetic municipal leadership committed to improving the environment, this in turn requires that the enabling framework is in place including structural strengthening of the local municipalities,” the PSC said.

It added: “The allocation of $1 billion for the development of entrepreneurship in rural communities is particularly pleasing to the private sector as a whole since the greatest boost to our economy will be a cadre of motivated entrepreneurs who can contribute to job creation and provide incentives to our young people.”

The PSC indicated that it is particularly pleased at the allocation of $100 million for technical and other assessments associated with the dredging of the mouth of the Demerara River.
It noted that the dredging of the Harbour will have a direct and positive impact on the competitiveness of our exports since freight charges will be significantly reduced.
“This will undoubtedly have a spin-off effect on the economy. Reduced freight charges will also benefit Guyanese consumers by making imports less expensive,” the PSC opined, adding:

“The PSC notes that the sum of $7.7 billion has been allocated for rural and hinterland roads and would like to laud this provision since it is imperative for both the development of our economy and the social development of our people that communication channels in the hinterland be opened up,”
Plans for the establishment of a hospitality institute at a cost of US$4 million was hailed by the PSC as encouraging to the tourism sector which is fast assuming a more important role in the economy of the country.
“Although the Commission would have liked to see more incentives being provided for the tourism industry, it is convinced that a hospitality institute will have a positive impact on both the numbers of returning visitors as well as Guyana’s rating by international travel operators. In the latter regard, branded hotels such as the Marriott, which will open shortly, will provide a boost for business as well as tourist travel to Guyana and, in the medium term as experienced in many other countries, will impact positively on the fortunes of the smaller domestically owned facilities, in part by establishing high quality standards across the hospitality sector.” the PSC said.

It observed that while the other agriculture sector has improved, the PSC would like to see improvement to our veterinary and plant health facilities so that our exports can be certified to international standards.

The PSC stated that it is pleased that no new taxes have been introduced in Budget 2014, especially in the context of the tax reductions which the Commission has sought, and which were implemented in the preceding years, other than Property Tax which has escalated for most companies following the movement to 2011 property values.
“The Commission, however, feels that much more has to be done to increase the level of collections of revenue from those who evade taxation so that the burden on the salaried employee can be eased and so that a thorough review of the capacity of the NIS is also undertaken to ensure proper regulation and collection from the non-traditional sectors.”

“The Private Sector Commission is satisfied that many of its recommendations and proposals for the Budget were taken on board and that, once approved, the further development of the private sector will be assured in 2014.”